Zynex, Inc.
| Company Name | Zynex, Inc. |
| Stock Symbol | ZYXI |
| Class Period | March 13, 2023 to March 11, 2025 |
| Lead Plaintiff Motion Deadline | May 19, 2025 |
On June 4, 2024, medical journal STAT published a report on Zynex entitled “How a device maker inundated pain patients with unwanted batteries and surprise bills.” The report claimed Zynex engaged in an “oversupplying scheme” by sending inordinate amounts of monthly supplies like electrode pads and batteries in order to “bill insurers for thousands of dollars more than it otherwise could.” The report further revealed that, as a result of this practice, insurers were “kicking the company out of network.”
On this news, Zynex’s stock price fell $0.50 per share, or 5%, to close at $9.35 per share on June 4, 2024, on unusually heavy trading volume.
On March 11, 2025, after the market closed, Zynex reported its fourth quarter and full year 2024 financial results, revealing a significant revenue “shortfall” in the quarter “due to slower than normal payments from certain payers.” Zynex further revealed “Tricare has temporarily suspended payments as they review prior claims.” Tricare is the health insurance program for the U.S. military.
On this news, Zynex’s stock price fell $3.59 per share, or 51.3%, to close at $3.41 per share on March 12, 2025, on unusually heavy trading volume.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Zynex shipped products, including electrodes, in excess of need; (2) that, as a result of this practice, the Company inflated its revenue; (3) that the Company’s practice of filing false claims drew scrutiny from insurers, including Tricare; (4) that, as a result, it was reasonably likely that Zynex would face adverse consequences, including removal from insurer networks and penalties from the federal government; and (5) 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.
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