Robbins LLP: ReWalk Robotics Ltd. (RWLK) Misled Shareholders According to a Recently Filed Class Action
Robbins LLP announces that a class action complaint was filed against ReWalk Robotics Ltd. (NASDAQGM: RWLK) in the Superior Court of the State of California, County of San Mateo. The complaint is brought on behalf of all purchasers of ReWalk securities pursuant to the company’s September 12, 2014 initial stock offering (“IPO”), for alleged violations of the Securities Act of 1933 by ReWalk’s officers and directors. ReWalk, a medical device company, designs, develops, and commercializes exoskeletons for wheelchair-bound individuals.
ReWalk Accused of Misrepresenting Its Ability to Obtain Regulatory Approval for Its Product
According to the complaint, on or about September 17, 2014, ReWalk announced the closing of its offering of 3,450,000 ordinary shares to the public, through which the company raised approximately $41.4 million. ReWalk had previously filed with the U.S. Securities and Exchange Commission (“SEC”) the registration statement for the IPO, which described the company’s exoskeleton product, the anticipated market for it, as well as the company’s efforts to develop the product, obtain regulatory approval for it, and to sell it. The registration statement stated that the U.S. Food and Drug Administration (“FDA”) had classified ReWalk as subject to special controls, which included compliance with medical device consensus standards, performance of a postmarket surveillance clinical study demonstrating a reasonable assurance of safety and effectiveness in urban terrain, and a training program, among other things.
The complaint alleges, however, that the registration statement failed to disclose that ReWalk was unable to comply with the special controls and provide the FDA with a postmarket surveillance study of the ReWalk product. ReWalk omitted that it received a Warning Letter from the FDA in September of 2015, in which the FDA outlined ReWalk’s substantial failures to propose and commence an adequate postmarket surveillance plan. Making matters worse, ReWalk had in fact previously received several letters from the FDA in which it notified the company that the company’s postmarket surveillance submission lacked the information needed to complete the review. On May 10, 2016, ReWalk revealed that at the time of the IPO, the company had been unable to comply with the FDA’s special controls due to inadequate staffing. Following the release of the Warning Letter to the public on February 25, 2016, ReWalk stock fell over 50% from $11.65 per share to $5.70 per share on September 1, 2016.
ReWalk Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.