Management Report Opportunities and Risk Report 
Under the settlement agreement, Fresenius Medical Care will pay a total of US$ 115 million to the W.R.Grace & Co. bankruptcy estate, or as otherwise directed by the court, upon plan confirmation. The settlement agreement has now been approved by the pertinent court. Also, subject to the confirmation of the W.R.Grace & Co. settlement agreement, claims made out of court by certain private U.S. health insurers were also settled by agreement. Consequently, all legal issues resulting from the NMC transaction have been concluded subject to plan confirmation.
In October 2004, Fresenius Medical Care Holdings, Inc. and its subsidiaries, including Renal Care Group (RCG; before RCG was acquired) received subpoenas from the U.S. Department of Justice, Eastern District of New York. The subpoenas require production of a broad range of documents relating to the companies’ operations, with specific attention to documents relating to a certain hormone test and vitamin D therapies.
Furthermore, FMCH and its subsidiaries, including RCG (before its acquisition by Fresenius Medical Care) received in April 2005 (RCG in August 2005) a subpoena from the U.S. Department of Justice in St. Louis (Missouri) in connection with civil and criminal investigations. Documentation must be provided on clinical quality programs, business development activities, compensation of clinic managers, contractual relationships with doctors, joint ventures, and anemia treatment therapies, RCG’s suppliers, pharmaceutical and other services which RCG has provided for patients, RCG’s relations to companies in the pharmaceutical industry and RCG’s procurement of dialysis machines from FMCH. The Inspector General of the U.S. Department of Health and the Attorney General for the Eastern District of Texas confirmed their involvement in the review of the anemia management program.
In July 2007, the U.S. Attorney’s office filed a civil complaint against RCG and FMCH, in its capacity as RCG’s current corporate parent, in the U.S. district court, Eastern District of Missouri. The complaint seeks monetary damages and penalties in respect of the business activities of the RCG Method II supply company in 2005, before RCG was acquired by FMCH.
In August 2007, the Sheet Metal Workers National Pensions Fund filed a complaint in the U.S. district court of California alleging that Amgen, Inc., Fresenius Medical Care, and DaVita, Inc. had marketed Amgen’s products Epogen and Aranesp to hemodialysis patients for uses not approved by the FDA and thereby caused a putative class of commercial insurers to pay for unnecessary prescriptions of these products. Motions have been filed to consolidate this case with others against Amgen alone in a single case under the federal rules for multidistrict litigation.
Please see the Notes for further details.
Furthermore, the Fresenius Group is involved in various legal issues resulting from business operations and, although it is not possible to predict the precise outcome of these disputes, none is expected to have a significant adverse impact on the assets and liabilities, financial position and results of operations of the Group.
- Other risks
Other risks, such as environmental risks, and risks involving management and control systems or our IT systems, are not considered to be significant. IT risks are countered through security measures such as controls and monitoring. In addition, we counter these risks with constant investment in hardware and software as well as by improving our system know-how.
