iRhythm Technologies (NSDQ:IRTC) announced that president & CEO Mike Coyle has resigned due to personal matters.
San Francisco-based iRhythm said in a news release yesterday evening that CFO Douglas Devine will take over as interim CEO while the search for a permanent replacement for Coyle is conducted. The company’s board of directors formed a CEO search committee and retained a search firm to assist in the process.
Coyle agreed to support a well-ordered transition of his responsibilities to Devine and will provide consulting services to the company, centered around reimbursement matters, until a permanent CEO is named. Coyle left Medtronic in December 2020 to take over as CEO of the AI-powered heart monitor developer in January of this year.
The day after the announcement, IRTC shares were down more than –16% to $64 apiece by midday trading. MassDevice‘s MedTech 100 Index, which includes stocks of the world’s largest medical device companies, was down slightly.
iRhythm chairman Abhijit Talwalkaer said in the release that the board thanks Coyle for his leadership and contributions and respects his prioritization of personal matters, wishing him “all the best.”
“This was a difficult decision for me given the many growth opportunities I see for iRhythm and my confidence in the company. However, it was the right one for me personally,” Coyle said in the release. “I am committed to supporting our team as we continue our work to ensure that the pricing for iRhythm’s Zio XT technology reflects the differentiated, measurable benefits it provides. My work with iRhythm over these past months has reinforced my belief that iRhythm’s innovation, financial strength and talented team position the company well to grow and thrive.
“Having also worked closely with Doug since joining the company, I know he will ably guide iRhythm forward as the board completes its search process.”
Kaila Krum and other analysts at Truist said the resignation was a surprise, since Coyle has only been with the company for half a year. “After speaking with him directly, we do believe there are personal matters that are battling for Coyle’s time and focus right now, and it does sound like it has been challenging to strike a balance between those matters and the responsibilities of his role at iRhythm.”
Devine joined iRhythm as CFO in June 2020, having collected more than 25 years of financial, strategic and operational leadership experience previously, including holding the role of SVP and CFO at GlobalFoundries.
“Doug is an exceptional leader and well respected by the iRhythm team and our broader stakeholders. Given his record here and in prior roles, the Board has high confidence in Doug to lead the Company during this interim period,” Talwalkar said. “Doug is supported by a dedicated team at iRhythm, all of whom are focused on continuing to execute against the Company’s strategic priorities, including driving further scale, efficiencies and momentum in the business.”
The company said the transition to a new CEO with Devine taking the role, for now, does not affect the ongoing pursuit of what it considers “appropriate Medicare pricing” for its Zio XT ambulatory cardiac monitor. Additionally, iRhythm reiterated its second-quarter guidance of approximately 4% sequential growth from the first quarter of 2021.
Truist analysts said iRhythm management told them multiple times that there have not been any notable developments on the reimbursement front since the company’s earnings call in early May.
Executive editor Chris Newmarker contributed to this report. This story originally ran Tuesday, June 1, 2021, with the initial news of Coyle’s departure. Updated June 2 with comments from Truist, stock price.
