Investors have filed a lawsuit claiming Baxter (NYSE: BAX) violated federal securities laws as a result of issues with certain infusion pumps.
Bloomberg Law first reported the filing of the lawsuit in Illinois.
The class action suit seeks a trial by jury as investors hope to recover damages related to the rollout of its Novum IQ large-volume infusion pump (LVP). It pertains to those who acquired Baxter common stock between Feb. 23, 2022, and July 30, 2025.
Baxter began rolling out the Novum IQ LVP in Canada in late 2020. It launched the system in the U.S. in April 2024 after receiving FDA clearance. According to the lawsuit, filed in the Court for the Northern District of Illinois, the company called the launch a “landmark achievement,” with Novum IQ representing a “promising multiyear growth driver.”
Novum IQ pumps have been subject to a handful of regulatory hurdles in recent years.
In August issued a letter to affected customers recommending a correction for its Novum IQ infusion pump systems. Just a month before that, Baxter issued an alert outlining an issue in which the LVP pumps have the potential for underinfusion when transitioning from a flow rate to a higher flow rate (like a rate change or bolus). That notice came just weeks after an initial warning about potential underinfusion with all Novum IQ LVPs. The FDA identified it as the most serious type of recall, carrying the risk of injury or death.
The lawsuit states that “the true extent of the safety issues was revealed to the market when Baxter announced the suspension of all new Novum LVP sales” on July 31.
Allegations made against Baxter
The plaintiffs allege that Baxter “misled investors by portraying its Novum LVP as safe, while concealing systemic issues that put patients at risk of severe injury and death.” They say that the company “assured investors” of the addressing of issues that arose during the Canadian launch, all while the launch was allegedly “on the brink of failure due to recurring life-threatening defects in the devices that Baxter could not adequately correct.”
The complaint alleges that Baxter misled investors by failing to disclose defects and making inadequate attempts to address them. Plaintiffs claim there was a heightened risk of the pumps being taken out of service and sales being paused but “Baxter’s statements about the safety, efficacy, product rollout, customer feedback and sales prospects of the Novum LVPs were materially false and misleading.”
A whistleblower report brought issues to light in April, followed by a warning from Baxter a few weeks later. Then came the further warnings over the summer that built up to the sales hold. The lawsuit alleges that the company closely monitored Novum’s performance and offered older Spectrum pumps as an alternative.
According to the lawsuit, analysts expressed surprise by the sales pause, given previous statements of optimism. On July 31, Baxter stock fell 22.4%, closing at $21.76 per share. Shares currently trade at $22.89 apiece in late-afternoon trading today.
“As a result of Defendants’ wrongful acts and omissions, and the significant decline in the market value of the company’s common stock pursuant to the revelation of the fraud, plaintiff and other members of the class have suffered significant damages,” the lawsuit claims.
A spokesperson shared the following statement from Baxter:
As a matter of course, Baxter does not comment on the details of pending litigation, but we intend to vigorously defend our position against these allegations.
