Irhythm loses out but skyrockets anyway

The oft-seen pattern of a device company’s share price sliding and management brazening it out with positive spin was reversed yesterday by the heart monitoring company Irhythm Technologies. In a statement management lamented the Centers for Medicare and Medicaid Services’ decision not to issue the hoped-for 2022 US-wide coverage for devices like Irhythm’s adhesive electrocardiogram, Zio XT. Despite this, the company’s shares soared nearly 60%. Investors appeared to take solace from Irhythm’s statement that it is working with individual Medicare contractors to arrange pricing for four procedure codes that are relevant for Zio XT. Even with this increase, however, Irhythm’s stock is markedly lower than it was at the start of the year, before the CMS contractor Novitas, in mid-January, published new reimbursement codes for long-term electrocardiogram use, cutting the price from more than $300 to around $40-80. Further share price volatility could be on the cards tomorrow: Irhythm will release its third-quarter earnings after market close today. 

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