NASDAQ: IRTC Investor Alert: Lawsuit alleges Securities Laws Violations by iRhythm Technologies, Inc.

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A lawsuit was filed in the U.S. District Court for the Northern District of California by an investor who bought shares of iRhythm Technologies, Inc. (NASDAQ: IRTC) alleging that the company violated federal securities laws with respect to some purportedly false and misleading statements made between January 11, 2022, and May 30, 2023.

Investors who bought a sizable portion of iRhythm Technologies, Inc. (NASDAQ: IRTC) shares between January 11, 2022, and May 30, 2023, as well as those who bought any NASDAQ: IRTC shares before January 2022 and are still holding any of those shares, are subject to specific options, some of which have strict deadlines. Cutoff date: April 8, 2024. NASDAQ: IRTC investors may reach out to the Shareholders Foundation by phone at (858) 779-1554 or by email at [email protected].

Ambulatory electrocardiogram (ECG) monitoring devices are offered by digital healthcare startup iRhythm Technologies, Inc., situated in San Francisco, California, to patients in the US who are susceptible to arrhythmias. The company’s main offering is the Zio XT monitoring patch, which offers electrocardiogram (ECG) monitoring for up to 14 days. Since the Zio XT does not offer real-time information, it is meant for non-critical patients.

The Zio AT was created in 2017 by iRhythm Technologies, Inc.; according to the company, it offers all of the features of the Zio XT Service in addition to real-time data transfer and the ability to get notifications of clinical events that are actionable. Atrial fibrillation is one example of an actionable arrhythmic event. This disease can result in major medical issues, such as blood clots that can cause heart failure and stroke, as well as unsettling symptoms. During the 14-day wear period, the patented algorithmic software that analyzes the ECG data and detects arrhythmic events is connected to the Zio AT using a cellular transmittal device that is included with the device. Significantly, the Zio AT gadget is promoted as a mobile cardiac telemetry device to high-risk patients, presumably because of its ability to deliver real-time notifications of arrhythmic occurrences. Real-time monitors are another name for these kinds of heart monitors that are authorized for use in high-risk patients and offer notifications almost instantly. When compared to monitors without real-time warnings of arrhythmic events, real-time monitors are more expensive.

Due in part to Zio AT use, iRhythm Technologies, Inc. amended its fourth quarter and full year expectations on November 1, 2022. In a conference call with investors, the company disclosed that, starting in the fourth quarter, [iRhythm] voluntarily sent out a Customer Advisory Notice to [its] Zio AT customers. As a result, the company reduced its Zio AT prediction for the quarter to just 20% from the 40% growth target it had previously stated for the previous three quarters.

The company revealed on November 4, 2022, that it started the Customer Advisory Notice on September 28, 2022, in response to concerns brought up by the FDA during an inspection that resulted in an inspection observation report on Form 483. The Customer Advisory Notice alerted patients to vital issues that prevent the device from functioning as promised, including a labeling correction regarding the maximum transmission limits of the device while it is being worn.

Then, on May 4, 2023, iRhythm Technologies, Inc. declared that it had received a Subpoena Duces Tecum on April 4, 2023, from the Consumer Protection Branch of the U.S. Department of Justice’s Civil Division, asking for the production of a number of documents pertaining to [its] goods and services.J.P. Morgan analysts noted in a report dated May 5, 2023, that Boston Scientific, an iRhythm rival, had also revealed receiving a subpoena from the DOJ regarding its real-time monitoring product. This suggested to the analysts that the DOJ’s investigation into iRhythm had something to do with the Zio AT.

iRhythm Technologies, Inc. finally revealed on May 30, 2023, that it had received a warning letter from the FDA addressing a number of issues related to the marketing and functionality of the Zio AT device. The FDA took particular note of the fact that iRhythm had misrepresented the Zio AT’s approval for use in high-risk patients in need of continuous cardiac monitoring. In actuality, Zio AT is only authorized by the FDA for long-term arrhythmia event monitoring in non-critical care patients when real-time monitoring is not required.

iRhythm Technologies, Inc. (NASDAQ: IRTC) saw a decrease in share price from $140.23 on April 21, 2023, to as low as $94.11 on June 28, 2023, and $70.24 on November 10, 2023.

In the complaint, the plaintiff claims that the defendants broke federal securities laws while selling common shares of iRhythm Technologies, Inc. (NASDAQ: IRTC) to buyers between January 11, 2022, and May 30, 2023. The plaintiff specifically alleges that between January 11, 2022 and May 30, 2023, the defendants misrepresented to investors that the Zio AT monitor was a real-time monitor meant for high-risk patients. The defendants also allegedly boasted about the Zio AT’s potential growth as an innovative product that had just started to gain traction in the real-time monitoring market, which investors found appealing given the premium selling price associated with devices approved for high-risk patients. As a result of these misrepresentations, the price of iRhythm common stock traded at artificially inflated prices during this time period.

Shareholders Foundation should be contacted by those who bought shares in iRhythm Technologies, Inc. (NASDAQ: IRTC) as they have specific alternatives.

Get in touch with Investors Foundation, Inc.Michael Daniels: +1-(858)-779-1554; 3111 Camino Del Rio North, Suite 42392108, San Diego(858)[email protected] is the fax number.

About The Shareholders Foundation, Inc.: We are a professional portfolio monitoring and settlement claim filing service that keeps investors informed about securities class actions, settlements, judgments, and other legal news pertaining to the stock and financial markets. We also conduct research on shareholder issues. With a vast network of contacts, Shareholders Foundation, Inc. provides support, guidance, and aid to each and every shareholder. It is not a law firm, The Shareholders Foundation, Inc. The Shareholders Foundation is not involved in the filed, reached, or settled cases, investigations, or settlements mentioned. The public is offered this information as a service. It should not be relied upon and is not meant to be legal advice.

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