SAN FRANCISCO (Legal Newsline) - A company that makes dialysis machines faces a securities class action lawsuit that seeks compensation for a stock drop.
Lawyers at Saxena White are representing the Plymouth County Retirement Association as they sue Outset Medical in a suit filed July 8 in California federal court. They seek to represent all who bought Outset Medical stock between Sept. 15, 2020, and June 13, 2022.
Outset makes the Tablo Hemodialysis System, which purifies tap water then purifies and removes toxins from the blood of patients suffering kidney failure. Outset called the Tablo a "dialysis clinic on wheels."
Outset raised more than $570 million in two secondary stock offerings, but all the while, it was making significant changes to Tablo for use in the home. Those changes made it likely the FDA would order the company to cease all marketing and selling of Tablo, the suit says, while preventing it from performing the required "real world" testing.
Disappointing financial results for the first quarter were revealed on May 4, leading to drop in share price from $39.94 to $23.06.
On June 13, the company announced the FDA had forced it to hold all shipments of Tablo for home use until it received further regulatory clearance. The stock fell to $13.46.