Outset Medical, a US-based medical technology company specialising in dialysis devices, has filed a Form 144 with the Securities and Exchange Commission (SEC) for a proposed sale of shares dated 3 June. The filing, which signals the intention of an insider or major shareholder to sell stock, comes amid ongoing financial pressures for the firm.
The company has been struggling to maintain its listing on the Nasdaq stock exchange. In April, Outset Medical received a deficiency notice from Nasdaq for failing to keep its share price above the $1.00 minimum bid requirement for 30 consecutive trading days. The company now has until October 2024 to regain compliance or face delisting.
Form 144 filings are standard regulatory disclosures in the US, required when affiliated parties plan to sell restricted or controlled shares. While the filing does not specify the seller or the exact number of shares, it often precedes a reduction in insider holdings, which can weigh on investor sentiment.
For UK investors, Outset Medical is not a household name, but it is held by some UK-based funds and retail investors through US-listed healthcare portfolios. The stock has lost more than 90 per cent of its value since its 2021 IPO, reflecting broader challenges in the medical device sector, including supply chain disruptions and slower-than-expected adoption of its home dialysis system.
Analysts have noted that the company's cash burn rate and ongoing losses make it vulnerable to further dilution if it needs to raise capital. However, Outset Medical has stated it is exploring strategic alternatives, including potential partnerships or financing options, to stabilise its position.
Source: SEC Form 144 filing for Outset Medical, dated 3 June 2024.