Florida-based iRadimed (NSDQ:IRMD) watched its stock nosedive today after revealing an FDA warning letter chiding the company for its complaint handling and demanding a new 510(k) application for its infusion pumps.
Agency inspectors ruled after a site inspection that iRadimed’s IV infusion pumps are on the market illegally because they include updated software that has not been reviewed by the proper authorities. The FDA added that iRadimed needs to seek separate 510(k) clearances for its mRidium 3860+ infusion pump, as it was deemed a significant departure from the mRidium 3860 and mRidium 3850 pumps.
The company’s stock, which opened at $10 apiece in July, dropped to $6.65 as of about 1:10 p.m. EST, down some 36% on the day.
The warning means that iRadimed can no longer sell the mRidium pumps, which represent the majority of revenues. The company is "in the process of preparing a response to the warning letter and intends to work expeditiously to address the issues raised by the FDA," according to a statement issued this week.
"We take the matters identified in the warning letter seriously and are in the process of evaluating what corrective actions and associated costs may be required to fully address the matters raised in the warning letter," president & CEO Roger Susi said in prepared remarks.
The FDA also criticized iRadimed’s handling of user complaints, saying that the company’s efforts had failed to curb issues with its MRI infusion pumps. iRadimed received at least 18 complaints from 2010 to August 2012 for possible over-infusions associated with its pumps, and then received another 9 complaints of similar issues since Sept. 18, 2013, despite the company’s corrective actions.
