NEW YORK, Aug. 30, 2024 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Northern District of California on behalf of all persons or entities who purchased or otherwise acquired Outset Medical, Inc. (“Outset Medical” or the “Company”) (NYSE: OM) securities between August 1, 2022 and August 7, 2024, inclusive (the “Class Period”). The lawsuit seeks to recover damages for the Company’s investors under the federal securities laws.
The Complaint in this lawsuit alleges that Defendants made materially false and/or misleading statements, and failed to disclose material adverse facts about the Company’s business, operations, and prospects. The Complaint specifically alleges that, Defendants failed to disclose to investors: (1) the Tablo products were marketed for continuous renal replacement therapy, which is not one of the indications approved by the FDA; (2) that, as a result, Outset Medical was reasonably likely to submit an additional 510(k) application for the Tablo products; (3) that there was a substantial risk that the Company would cease sales of the Tablo products pending FDA approval of additional indications; (4) that Outset Medical lacked the sales team and process to execute on the ramp of Tablo sales; (5) that, as a result of the foregoing, the Company’s revenue growth would be adversely impacted; and (6) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
The Complaint further alleges that the truth began to emerge on July 7, 2023, after the market closed, when Outset Medical disclosed that it had been warned by the FDA of off-label marketing of the Tablo. The Complaint alleges that specifically, in a Form 8-K filed with the SEC, Outset Medical stated that it received a Warning Letter from the FDA which “asserted that certain materials . . . promote continuous renal replacement therapy (CRRT), a modality outside of the current indications for the Tablo Hemodialysis System” and “assert[ed] that the TabloCart with Prefiltration . . . requires prior 510(k) clearance for marketing authorization.”
According to the Complaint, on this news, Outset Medical’s stock price fell $1.97, or 10.18%, to close at $17.39 per share on August 3, 2023, on unusually heavy trading volume.
Investors who purchased or otherwise acquired shares of Outset Medical should contact the Firm prior to the October 28, 2024 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
Please visit our website at http://www.gme-law.com for more information about the firm.
