Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): August 30, 2024

iRhythm Technologies, Inc.

(Exact name of Registrant as specified in its charter)


Delaware	001-37918	20-8149544
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

699 8th Street, Suite 600

San Francisco, California 94103

(Address of principal executive office) (Zip Code)

(415) 632-5700

(Registrant’s telephone number, including area code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, Par Value $0.001 Per Share	IRTC	The NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01. Entry into a Material Definitive Agreement.

Technology License Agreement

On August 30, 2024, iRhythm Technologies, Inc. (the “Company”) entered into a Technology License Agreement (the “License Agreement”) with BioIntelliSense, Inc. (“BioIS”), pursuant to which (i) the Company will receive a perpetual fully paid up license to certain of BioIS’ intellectual property, technology and products for research, development and commercialization of potential next-generation products and services in certain fields of use, including an exclusive license to develop and commercialize pulse oximetry, accelerometry, and trending non-invasive blood pressure technologies for use within the Company’s ambulatory cardiac monitoring products and services, and (ii) the Company and BioIS agreed to negotiate in good faith a supply agreement for pulse oximetry hardware.

Under the terms of the License Agreement, the Company will pay BioIS an upfront fee of $15.0 million in cash upon the Company's acceptance of the initial transfer of certain licensed technologies and data following the execution of the License Agreement. In addition, the Company will pay BioIS up to an aggregate of $20.0 million, plus accrued and unpaid interest, if any, on the Milestone Notes (as defined below), in additional milestone payments upon achievement of various regulatory milestones over the term of the License Agreement. BioIS is also eligible to receive low single-digit royalty payments on annual net sales of certain products in the home sleep testing field, subject to certain adjustments specified in the License Agreement. The royalty payment obligations under the License Agreement expire on a country-by-country basis no earlier than ten years following the first commercial sale and expiration of the last valid claim of a licensed patent right of a covered product under and pursuant to the terms of the License Agreement.

The License Agreement will be terminable for convenience by the Company at any time by giving BioIS at least 30 days’ prior notice or upon BioIS’ bankruptcy. The License Agreement may also be terminated by either party upon uncured material breach of the License Agreement by the other party. The license grants survive termination or expiration of the License Agreement.

Neither party may assign the License Agreement, without the written consent of the other party, which will not be unreasonably withheld, conditioned, or delayed, except that either party may assign the License Agreement without consent to an affiliate (in the case of BioIS, an affiliate that acquires all of the licensed technologies and intellectual property rights) under the License Agreement or to an entity that acquires such party or the portion of such party’s business to which the License Agreement pertains (whether by merger or sale of assets, stock, or ownership interest).

In connection with the License Agreement, the Company also purchased an aggregate of $40.0 million of convertible promissory notes from BioIS (the “Convertible Notes”). Convertible Notes with a principal amount of $20.0 million (the “Milestone Notes”), plus accrued and unpaid interest, if any, shall be cancelled to satisfy the Company’s milestone payment obligations, if achieved, under the License Agreement.

The foregoing description of the License Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the License Agreement, a redacted copy of which will be filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarter ending September 30, 2024, and upon filing will be incorporated herein by reference. The Company intends to redact certain portions of the License Agreement that are not material and would be competitively harmful if publicly disclosed pursuant to Item 601(b)(10)(iv) of Regulation S-K.

Item 7.01. Regulation FD Disclosure.

On September 4, 2024, the Company issued a press release announcing the entry into the License Agreement with BioIS, a copy of which is attached hereto as Exhibit 99.1.

The information in this Item 7.01 of this report, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits


Exhibit No.						Description
99.1						Press Release of iRhythm Technologies, Inc. dated as of September 4, 2024
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	IRHYTHM TECHNOLOGIES, INC.

Date: September 4, 2024	By:	/s/ Quentin S. Blackford
		Quentin S. Blackford
		Chief Executive Officer

Exhibit 99.1 iRhythm Technologies Enters License Agreement with BioIntelliSense for Multiparameter Sensor Technology to be Used in Ambulatory Cardiac Monitoring iRhythm granted exclusive license to BioIntelliSense’s patented pulse oximetry, accelerometry and trending non-invasive blood pressure technologies for use within ambulatory cardiac monitoring (ACM) market SAN FRANCISCO, SEPTEMBER 4, 2024 (GLOBE NEWSWIRE) -- iRhythm Technologies, Inc. (NASDAQ:IRTC), a leading digital health care company focused on creating trusted solutions that detect, predict, and prevent disease, announced today that the company has signed an exclusive license agreement with BioIntelliSense, Inc., a continuous health monitoring and clinical intelligence company, to develop and commercialize certain patented technology assets within ambulatory cardiac monitoring (ACM). “As a natural complement to iRhythm’s leading ambulatory cardiac monitoring platform, BioIntelliSense’s multiparameter sensing technologies position us to significantly expand the capabilities of our product platform over the next several years,” said Quentin Blackford, iRhythm’s President and CEO. “We believe that the licensed technology from BioIntelliSense can advance our premium positioning within ACM and further enables us to enter other adjacent indications such as obstructive sleep apnea over time. By incorporating medical grade, connected, multi-sensor capabilities, we believe iRhythm will be well positioned to deliver broad clinical insights that improve patient outcomes, enhance clinical and operational efficiency, and reduce costs to the healthcare system. We look forward to collaborating with the BioIntelliSense team to accelerate the next chapter of connected patient care.” BioIntelliSense offers a comprehensive set of vital sign indicators that enables early identification and detection of adverse trends to improve patient monitoring safety and effectiveness from in the hospital to the home via a portfolio of medical grade wearable devices and data services. Their comprehensive set of patient trending and algorithmic-based personalized notifications includes resting heart rate, respiratory rate, and skin temperature via their FDA-cleared BioButton® wearable device. BioIntelliSense also has patented capabilities that represent a significant advancement in the field of oximetry with its white-light enhanced pulse oximetry (SpO2) sensor chipset and integrated processing technology that facilitates measurement of blood oxygen levels across the full range of light to very dark skin pigmentations with unique motion-tolerance capabilities. “We couldn’t be more excited about this collaboration with iRhythm, whose deep experience in ECG ambulatory cardiac monitoring is a perfect complement to the continuous vitals sign and medical grade wearable expertise of BioIntelliSense,” said James Mault, MD, founder and CEO of BioIntelliSense. “Through the integration of advanced biosensors and algorithmic-based analytics, we can collectively address a critical gap in the current healthcare system, by providing clinicians with more timely and actionable information to facilitate earlier clinical intervention and better, safer patient care.” As multiple vital signs and digital data assets are increasingly combined to generate clinical insights, iRhythm and BioIntelliSense are excited to be market leaders in defining how continuous monitoring could look over the next decade and beyond. iRhythm is building a data-

driven health care portfolio for the future and is uniquely positioned to address the quintuple aim of healthcare in the years to come. License Overview Under the terms of the agreement, BioIntelliSense has granted iRhythm an exclusive license to develop and commercialize pulse oximetry, accelerometry, and trending non-invasive blood pressure technologies for use within iRhythm’s ACM products and services. In connection with the license agreement, BioIntelliSense will receive an upfront payment, and they will be eligible to earn additional consideration based on future technology validation and regulatory milestones. BioIntelliSense will also be eligible to receive royalties on annual net sales of products and services that include licensed rights in the home sleep testing field of use. The license consideration payable to BioIntelliSense will be recognized on iRhythm’s consolidated statements of operations as acquired in-process research and development (“IPR&D”) expense. Additional consideration may be earned by BioIntelliSense through December 31, 2026, relating to the achievement of certain development milestones and may be recognized as acquired IPR&D expense. In alignment with SEC guidance around non-GAAP financial measures relating to acquired IPR&D expense, iRhythm will not exclude expenses related to IPR&D from its non-GAAP results, which include adjusted operating expenses, adjusted net loss, adjusted net loss per share, and adjusted EBITDA. iRhythm provided 2024 annual financial guidance on August 1, 2024, related to revenue, gross margin, and adjusted EBITDA. Based on currently available information, iRhythm reaffirms its current 2024 annual financial guidance for revenue, gross margin, and adjusted EBITDA excluding this transaction. iRhythm does not expect to incur any material incremental development expenses in 2024, other than the acquired IPR&D expense, associated with this transaction. iRhythm will provide an update for its 2024 annual financial guidance when iRhythm reports its third quarter 2024 results. About iRhythm Technologies, Inc. iRhythm is a leading digital health care company that creates trusted solutions that detect, predict, and prevent disease. Combining wearable biosensors and cloud-based data analytics with powerful proprietary algorithms, iRhythm distills data from millions of heartbeats into clinically actionable information. Through a relentless focus on patient care, iRhythm’s vision is to deliver better data, better insights, and better health for all. About BioIntelliSense, Inc. BioIntelliSense is ushering in a new era of continuous health monitoring and clinical intelligence for virtual care and remote patient monitoring (RPM) from in-hospital to home. Its medical-grade Data-as-a-Service (DaaS) platform seamlessly captures multiparameter vital signs and physiological biometrics through an effortless user experience. The FDA-cleared BioButton® multiparameter wearable, BioHub™ gateways, BioMobile™ downloadable applications, BioCloud™ data services and the BioDashboard™ clinical intelligence system creates a comprehensive tech-enhanced solution that makes continuous monitoring reliable and scalable. Through the platform’s AI-driven analytics, clinicians have access to high-resolution patient trending and data-driven insights to deliver better, safer care from in-hospital to home. Use of Non-GAAP Financial Measures We refer to certain financial measures that are not recognized under U.S. generally accepted accounting principles (GAAP) in this press release, including adjusted EBITDA. We use these

non-GAAP financial measures for financial and operational decision-making and to evaluate period-to-period comparisons. See the schedules in our most recent filings made with the Securities and Exchange Commission, including those on the Form 10-Q filed on August 1, 2024, for additional information and reconciliations of such non-GAAP financial measures. We have not reconciled our adjusted operating expenses and adjusted EBITDA estimates for full year 2024 because certain items that impact these figures are uncertain or out of our control and cannot be reasonably predicted. Accordingly, a reconciliation of adjusted operating expenses and adjusted EBITDA estimates is not available without unreasonable effort. Adjusted EBITDA excludes non-cash operating charges for stock-based compensation expense, impairment and restructuring charges, business transformation costs, and loss on extinguishment of debt. Business transformation costs include costs associated with professional services, employee termination and relocation, third-party merger and acquisition, integration, and other costs to augment and restructure the organization, inclusive of both outsourced and offshore resources. Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These statements include statements regarding the anticipated benefits and accounting treatment of our licensing agreement and partnership with BioIntelliSense, anticipated technology improvements and expectations for growth. Such statements are based on current assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties, many of which are beyond our control, include risks described in the section entitled “Risk Factors” and elsewhere in our filings made with the Securities and Exchange Commission, including those on the Form 10-Q filed on August 1, 2024. These forward-looking statements speak only as of the date hereof and should not be unduly relied upon. iRhythm disclaims any obligation to update these forward-looking statements. iRhythm Contact Information Investor Contact Stephanie Zhadkevich investors@irhythmtech.com Media Contact Kassandra Perry irhythm@highwirepr.com

Document and Entity Information Document	Aug. 30, 2024
Cover [Abstract]
Document Type	8-K
Document Period End Date	Aug. 30, 2024
Entity Registrant Name	iRhythm Technologies, Inc.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-37918
Entity Tax Identification Number	20-8149544
Entity Address, Address Line One	699 8th Street
Entity Address, Address Line Two	Suite 600
Entity Address, City or Town	San Francisco
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94103
City Area Code	415
Local Phone Number	632-5700
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, Par Value $0.001 Per Share
Trading Symbol	IRTC
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0001388658
Amendment Flag	false