Inspire Medical Systems Faces Legal Investigation Amid Launch Challenges
Inspire Medical Systems Inc. has seen its stock price drop significantly, hitting a 52-week low, as the company faces serious challenges with the Inspire V launch amid a broader market decline.
Kuehn Law, PLLC is investigating whether executives at Inspire Medical Systems breached their fiduciary duties to shareholders, which could expose the company to legal risks and financial losses. The Inspire V launch is struggling due to low demand, primarily caused by providers holding significant surplus inventory and disincentives from reduced physician payments. Additionally, the company failed to complete necessary tasks for the launch, including training and onboarding for treatment centers, which could lead to operational chaos post-launch. These issues have raised concerns about the accuracy of the company's positive statements regarding its preparedness, potentially eroding shareholder trust and negatively impacting stock prices.
The implications of this investigation and the challenges surrounding the Inspire V launch could significantly affect Inspire Medical Systems' market position and investor confidence, especially as the company navigates these turbulent waters.
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- Investigation Launched: Kuehn Law, PLLC is investigating whether executives at Inspire Medical Systems, Inc. breached their fiduciary duties to shareholders, which could expose the company to legal risks and financial losses.
- Launch Challenges: The Inspire V launch is struggling due to low demand, primarily caused by providers holding significant surplus inventory and disincentives from reduced physician payments, potentially impacting the company's market share and future revenues.
- Critical Tasks Incomplete: The company failed to complete prerequisite tasks necessary for the Inspire V launch, including training and onboarding for many treatment centers and lacking necessary IT approvals, which could lead to operational chaos post-launch.
- False Statement Risks: The company's positive statements regarding its preparedness for the Inspire V launch have been accused of being materially false or misleading, which may erode shareholder trust in management and negatively affect stock prices and investor confidence.

- Legal Investigation Launched: Kuehn Law, PLLC is investigating whether executives at Inspire Medical Systems, Inc. breached their fiduciary duties to shareholders, as a federal securities lawsuit highlights significant undisclosed issues regarding the Inspire V launch.
- Launch Challenges: The Inspire V launch is struggling due to low demand, primarily caused by providers holding excess inventory and disincentives from reduced physician payments, which directly impacts the company's market performance.
- Critical Tasks Incomplete: The company failed to complete prerequisite tasks necessary for the Inspire V launch, including training and IT approvals for treatment centers, which hindered the installation of the crucial SleepSync program and affected market acceptance.
- False Statement Risks: Due to these issues, Inspire's positive statements regarding its launch preparedness are deemed materially false or misleading, potentially exposing shareholders to investment loss risks.
- Small Cap Performance: By 1:40 p.m. in New York, the Russell 2000 surged 1.1% to 2,730 points, reaching a record high and extending its year-to-date gains to 10%, reflecting strong investor confidence in small-cap stocks.
- Strong Macro Data: The U.S. GDP growth rate for Q3 was revised up to 4.4% annualized, from 4.3%, accelerating from 3.8% in Q2, indicating robust economic recovery that could drive increased business investment and consumer spending.
- Contained Inflation Pressures: The Personal Consumption Expenditures price index rose 2.8% year-over-year, with core PCE steady, suggesting that inflation remains manageable, which enhances market confidence in the Federal Reserve's policies and may help maintain a low interest rate environment.
- Tech Stock Rebound: Meta Platforms saw a more than 5% increase in stock price after Jefferies highlighted its attractive valuation, further boosting investor interest in tech stocks, potentially leading to increased capital inflows into the sector.

- Board Investigation: The Law Offices of Frank R. Cruz is investigating whether the board of directors of Inspire Medical Systems breached its fiduciary duties to shareholders, potentially exposing them to financial losses.
- Product Launch Delay: The launch of the Inspire V sleep apnea device is facing an 'elongated timeframe' due to several issues, including many centers failing to complete necessary training and contracting criteria, which impacts device purchase and implantation.
- Earnings Guidance Cut: The company has drastically reduced its 2025 earnings guidance from $2.20-$2.30 per share to $0.40-$0.50 per share, reflecting severe impacts from weak market demand and excess inventory.
- Stock Price Plunge: On August 5, 2025, Inspire's stock price plummeted by $42.04, or 32.4%, closing at $87.91 per share, significantly harming investor interests.
- Rating Downgrade Impact: Oppenheimer downgraded Inspire Medical Systems from outperform to perform due to CMS's update indicating that obstructive sleep apnea is no longer a covered indication under the vagus nerve stimulation National Coverage Determination, leading analyst Suraj Kalia to predict a potential recalibration of FY26 guidance.
- Increased Sales Pressure: The dynamics of new site openings and inventory sales are now under pressure, which could negatively impact Inspire's market performance, directly affecting the company's revenue and market share.
- Stock Price Volatility: Inspire's shares dropped 12% in Thursday afternoon trading, reflecting investor concerns about the company's future profitability, particularly in light of the recent changes in healthcare policy.
- Acquisition Potential Diminished: Kalia noted that while Inspire may have been considered a potential acquisition target, the current timing, rationale, and economic factors could raise questions about the feasibility of such a move, impacting the company's strategic direction.

- Quarterly Revenue Growth: Inspire Medical Systems anticipates fourth-quarter revenue between $268.9 million and $269.1 million, reflecting a 12% year-over-year increase, indicating strong market performance and sustained growth potential.
- Annual Performance Outlook: The company projects full-year 2025 revenue of $911.8 million to $912.0 million, representing a 14% increase from 2024, showcasing robust development in the medical device sector and rising market demand.
- Future Revenue Projections: For fiscal 2026, Inspire expects revenue between $1.003 billion and $1.013 billion, implying a year-on-year growth of 10% to 11%, demonstrating management's confidence in future business growth and optimistic market outlook.
- Executive Appointment: Matt Osberg has been appointed as CFO, bringing over 20 years of global financial leadership experience, which is expected to enhance the company's strategic transformation and financial management optimization.








