{ "docId": "019dd923-622c-750b-8b99-bca3fd68622d", "docSlug": "4c8fe6013c68", "documentTitle": "iRhythm Technologies, Inc. (IRTC)", "authorId": "54_Spruce_Point_Capital", "authorName": "Spruce Point Capital Management", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2025-08-18 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 34, "pageCount": 101, "prevPage": 33, "nextPage": 35, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 0, "notes": "The slide highlights specific text in red to emphasize the FDA's finding of miscalculation.", "elementsJson": [ "headline_text", "callout_box", "paragraph", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b99-bca3fd68622d/34", "deckHref": "/decks/019dd923-622c-750b-8b99-bca3fd68622d", "deckJsonHref": "/decks/019dd923-622c-750b-8b99-bca3fd68622d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-bca3fd68622d#slide-34", "components": [ { "bbox": { "h": 0.08, "w": 0.96, "x": 0.02, "y": 0.17 }, "kind": "callout", "text": "The FDA Warning Letter is particularly insightful as an indictment of iRhythm's internal product development process and questionable data science capabilities. For example, the FDA found that iRhythm did not accurately calculate a key risk metric related to the potential frequency of patient injury.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "abb8503a-e8f9-40cf-8083-d5143bc754d8", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "callout", "text": "Your miscalculation underestimated the likelihood of someone being injured.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-64d2-7657-bbed-50c6830e210c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.55, "w": 0.96, "x": 0.02, "y": 0.34 }, "kind": "paragraph", "text": "FDA finds iRhythm miscalculated a key risk metric\n\"We reviewed your firm's response and concluded that it is not adequate... based on FDA's own calculations, these HHEs do not appear to be conducted in accordance with your Risk Management SOP (SOP0010). For example, when conducting HHE-[redacted], it appears your firm failed to properly calculate the probability of occurrence of the potential safety issue. Your miscalculation underestimated the likelihood of someone being injured... This miscalculation is significant because this HHE procedure is used to assess whether or not you will initiate field action.\"", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a600a88c-6e05-4521-9b39-04188e5c2e18", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "We reviewed your firm's response and concluded that it is not adequate. Your response states that your firm's process about when to escalate a CAPA to an HHE [health hazard evaluation] was not clear. As such, CAPA procedural updates were made, and training was performed. Specifically, you updated your CAPA to include the statement, \"The issue will be assessed... [in accordance with the Health Hazard Evaluation Procedure], to determine if the criteria for an HHE has been met, and whether field action is required.\" Your firm also conducted an HHE for the Activation Time Mismatch error, as required by your CAPA procedures. In addition, your firm conducted several other HHEs. It is important that the HHE be performed in accordance with your firm's Risk Management SOP (00010) because the outcome of the HHE is used to determine some of your firm's corrective and/or preventative actions. However, based on FDA's own calculations, these HHEs do not appear to be conducted in accordance with your Risk Management SOP (SOP0010). For example, when conducting HHE-[redacted], it appears your firm failed to properly calculate the probability of occurrence of the potential safety issue. Your miscalculation underestimated the likelihood of someone being injured. According to your updated CAPA procedure, the difference in the occurrence rating for HHE-[redacted] would have required an update to your risk documentation and the HHE shows that this was not selected. Further, when conducting HHE-[redacted], your firm failed to apply the Health Risk Table in your Risk Management SOP (SOP0010). This miscalculation is significant because this HHE procedure is used to assess whether or not you will initiate field action. — FDA Warning Letter Dated 5/25/23 (CMS 643474)", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-64d2-7657-bbed-54213233c664", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.5, "x": 0.02, "y": 0.96 }, "kind": "source-note", "text": "Red text for Spruce Point emphasis. Source: FDA Warning Letter dated 5/25/23 (CMS 643474)", "attrs": null, "subkind": "source-note", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "11c26b21-1c43-488a-81a2-6295079c55f4", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.96, "x": 0.02, "y": 0.27 }, "kind": "subtitle", "text": "Excerpts From FDA Warning Letter Dated 5/25/23 (CMS 643474)", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fbfbde40-f252-4d4f-bef3-f7480cd9ebea", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.68, "x": 0.28, "y": 0.03 }, "kind": "title", "text": "How Can iRhythm Claim AI Expertise When It Seemingly Cannot Perform Basic Math Correctly?", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ca0ff1af-0bf6-454f-8c1d-1623e0c21cf6", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "a51d84af-f00d-4e5a-ab4e-1a81c361037f", "evidence": "The slide uses regulatory findings to undermine the company's core competency claims.", "confidence": 0.9 } ], "arcBeats": [ { "to": 40, "from": 25, "beatId": "0a38a245-fa4d-49e4-b7bb-ca7320e46cc1", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "Thesis Headline", "beatSlug": null, "evidence": "The document presents Spruce Point Capital Management's thesis and key messages.", "position": 2, "confidence": 0.8, "parentBeatName": null, "parentBeatSlug": null } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }