According to the lawsuit, Defendants failed to disclose to investors that: (1) Zynex shipped products, including electrodes, in excess of demand; (2) as a result, Zynex was able to inflate its revenue; (3) the Company’s practice of filing false claims drew scrutiny from insurers, including Tricare; and (4) thus, it was reasonably likely that Zynex would face adverse consequences, including removal from insurer networks and penalties from the federal government.

On June 4, 2024, medical journal STAT published a report titled “How a device maker inundated pain patients with unwanted batteries and surprise bills,” which claimed that Zynex engaged in an “oversupplying scheme” by sending inordinate amounts of supplies, such as 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 March 11, 2025, Zynex reported Q4 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 [health insurance program for the U.S. military] has temporarily suspended payments as they review prior claims.”

On this news, Zynex’s stock price fell $3.59 per share, or 51%, to close at $3.41 per share on March 12, 2025.

Investors who purchased or acquired Zynex securities between March 13, 2023 through March 11, 2025, may no later than May 19, 2025, seek to be appointed as a lead plaintiff representative of the class.