Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased Outset Medical, Inc. (“Outset” or the “Company”) (NASDAQ: OM) common stock between September 15, 2020 and June 13, 2022, inclusive (the “Class Period”). Outset investors have until September 6, 2022 to file a lead plaintiff motion.
Investors suffering losses on their Outset investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to howardsmith@howardsmithlaw.com.
On May 4, 2022, after the market closed, Outset disclosed disappointing results for first quarter 2022, including a net loss of $35.9 million. Analysts attributed the results to the unproven reliability of the Company’s Tablo Hemodialysis System (“Tablo”) for kidney failure patients.
On this news, Outset’s stock fell $16.88, or 42.3%, over the next three consecutive trading days, to close at $23.06 per share on May 9, 2022, thereby injuring investors.
Then, on June 13, 2022, Outset announced that it had implemented “a shipment hold on the distribution of its Tablo Hemodialysis System for home use pending” a review and clearance of a 510(k) application by the U.S. Food and Drug Administration (“FDA”). The Company withdrew its prior guidance and expected second quarter 2022 revenue of at least $25 million due to the shipment hold. Despite prior assurances that the Company was conducting its study in accordance with FDA protocols requiring “real-world data” gathered in “the home environment,” its Chief Executive Officer also revealed that it had “run with a protocol that involves a simulated use environment at a human factors lab.”
On this news, Outset’s stock fell $6.95, or 34.1%, to close at $13.46 per share on June 14, 2022, thereby injuring investors further.
The complaint filed in this action alleges that, throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose that: (1) Defendants had “continuously made improvements and updates to Tablo over time since its original clearance” that required an additional 510(k) application; (2) as a result, the Company could not conduct a human factors study on a cleared device in accordance with FDA protocols; (3) the Company’s inability to conduct the human factors study subjected the Company to the likelihood of the FDA imposing a “shipment hold” and marketing suspension, leaving the Company unable to sell the Tablo for home use; and (4) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.
If you purchased Outset common stock, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.
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Contacts
Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
888-638-4847
howardsmith@howardsmithlaw.com
www.howardsmithlaw.com
