Several leading makers of knee, hip and other orthopedic implants revealed Friday that federal regulators are looking into possibly unlawful sales of their products in foreign countries.
Stryker Corp., Zimmer Holdings Inc., Smith & Nephew plc and Medtronic Inc. each said the Securities and Exchange Commission is conducting an informal inquiry into possible company violations of the Foreign Corrupt Practices Act, which outlaws bribing foreign officials to obtain or retain business. The SEC has brought civil charges under the act against a number of companies in recent years.
All firms said they would cooperate with the investigation and do not believe they broke the law.
Stryker and Zimmer specialize in replacement implants for the knees, hips and other joints. Medtronic makes spinal implants to reduce pain and restore movement of the back and neck.
Last month Biomet Orthopedics Inc., Johnson and Johnson’s Depuy Orthopedics, Smith & Nephew Inc. and Zimmer Holdings Inc. agreed to pay $310 million to settle charges that they gave U.S. doctors kickbacks to boost product sales. Stryker was not charged in the case because it cooperated with Department of Justice investigators early in the investigation. All five companies will be monitored by the federal government through early 2009.
Zimmer spokesman Brad Bishop said the company does not believe the investigation into foreign sales practices is connected to the Department of Justice case.
A Stryker spokeswoman declined to comment on the nature of the investigation.
Shares of Zimmer Holdings fell $1.63 Friday to $82.97 in afternoon trading. Shares of Stryker Corp. rose 85 cents to $73.98. Medtronic Inc. shares fell 1 cent to $56.43. Shares of Smith & Nephew were even at $62.33.
American Airlines raised many domestic fares by $5 each way but left prices unchanged on routes where it competes with low-cost carriers.
The Thursday night increase affected both advance-purchase tickets favored by vacationers and more costly last-minute tickets aimed at business travelers.
Tim Smith, a spokesman for the airline owned by Fort Worth-based AMR Corp., said the fare increase was needed to cover high fuel costs.
Shares of AMR rose $1.23 cents, or 5.4 percent, to $25.14 in afternoon trading.
Fall is typically a slower time for air travel, which could make carriers reluctant to raise fares.
But this week, UAL Corp.’s United Airlines raised fares to Hawaii and other carriers went along, indicating that demand is firming, said Rick Seaney, chief executive of travel Web site FareCompare.com.
Jamie Baker, an analyst for JPMorgan, said the recent run-up in spot prices for jet fuel made it highly likely that other network carriers would match American’s fare increase.