Biomet tells the SEC that a distributor in the Middle East broke their agreement with sales of dental products to Iran.
Biomet Inc. said that a third-party distributor in the Middle East sold some of its dental products in Iran, violating the terms of their agreement.
Responding to a March 19 letter from Cecilia Blye, chief of the U.S. Securities & Exchange Commission's office of global security risk, Biomet said in a regulatory filing that the deal limited sales to specific countries. That means "any sales to customers in Iran since the beginning of fiscal year 2010 violated that agreement," according to the filing.
"The company is considering its rights and remedies against this distributor in connection with these violative sales," Biomet said, noting that the amount of the resales in Iran were $434,205, $540,749 and $379,967 for fiscal years ended May 31, 2009, 2010 and 2011, respectively.
The SEC also wanted some answers about Biomet's sales in Syria. That country and Iran are on the U.S. State Dept.'s list of state sponsors of terrorism "and are subject to U.S. economic sanctions and export controls," according to the SEC.
Biomet said all sales to those countries are made via foreign subsidiaries that, in turn, sell to third-party distributors.
"To our knowledge, neither the company nor any of its distributors has entered into arrangements with or sold products to persons included on the Specially Designated Nationals List administered by the U.S. Office of Foreign Asset Control," according to the filing. "The company does not maintain any direct sales activity or operations, nor does it employ any persons, in Iran or Syria. The company's non-U.S. subsidiaries do, however, have certain limited, non-sales related contacts with customers in Syria."
Biomet has 1 distributor that sells orthopedic devices into Syria, it said, adding that during fiscal 2010 it also sold in Syria via a 2nd distributor.