This article was originally published in The Gray Sheet
Maker of the NC-stat neuropathy diagnostic system faces a bevy of shareholder class action law suits stemming in part from concerns over reimbursement for the system that contributed to a 19% drop in the company's sales last year to $44.6 million. NeuroMetrix denies charges that it made false and misleading statements between Oct. 27, 2005 and March 6, 2007, as the shareholder suits allege. The Radnor, Pa., law firm of Schiffrin Barroway Topaz & Kessler charges NeuroMetrix, in part, with failing to disclose that health insurers were routinely and increasingly denying reimbursement for NC-stat. On Feb. 9, the American Medical Association CPT editorial panel failed to determine that existing Category I CPT codes were applicable to nerve conduction studies with NC-stat, contrary to the company's hopes, and instead proposed a new Category III CPT code that would "likely result in limited or no Medicare reimbursement" for nerve conduction studies with NC-stat and could adversely impact third-party payers, NeuroMetrix announced Feb. 12. The Waltham, Mass., company maintains that the recent class action suits are "without merit." The company's stock plunged 82% from $10.62 on Feb. 8 to $1.92 on March 28
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