Guidant Forms Reliability Squad

The company hires a panel of outsiders to help it regain its footing.
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Guidant

(GDT)

, whose heart-device recalls have stymied its plan to merge with

Johnson & Johnson

(JNJ) - Get Report

, is hoping that bringing in a group of outsiders will help to repair its reputation.

The Indianapolis-based company said Tuesday the establishment of what's being called the Design for Reliability Team will "point the way towards industry-leading practices in the design and manufacture of life-saving medical devices."

Dan L. Crippen, former director of the Congressional Budget Office, will lead the group.

"Guidant has a long history of pioneering innovation while simultaneously assuring high quality product systems," the company said in a press release, adding that it's "committed to help physicians treat their patients with leading technology and high reliability."

Questions about that quality and reliability were what led to a series of problems for Guidant this year. Since June, the company has recalled or issued warnings covering about 88,000 defibrillators and nearly 200,000 pacemakers, according to

The Associated Press

.

Additionally, the Food and Drug Administration and other agencies are investigating the timeliness of Guidant's communications with doctors about product malfunctions.

The Design for Reliability Team will review all phases of product development, from initial concept planning to full production. A separate panel that's evaluating Guidant's post-marketing device-safety surveillance and communications is continuing its work.

Guidant said Monday that it filed a lawsuit to force Johnson & Johnson to complete the companies' $25.4 billion merger. The companies had been waiting for the Federal Trade Commission to clear the deal, but after that happened last week, Johnson & Johnson was more than a little hesitant to complete the merger.

The prodigious New Brunswick, N.J., health-products maker said that not only were Guidant's short-term results and long-term outlook affected by its device recalls, but the matters were serious enough to free it from having to close the deal according to the $76-a-share agreement.