Eargo To Pay $34.4 Mln To Resolve Allegations With The US Govt.

(RTTNews) - Hearing aid maker Eargo, Inc. (EAR) has agreed to pay $34.4 million to the US government to settle allegations related to insurance reimbursement claims, the company said in a statement.

The U.S. Department of Justice were investigating Eargo's role into submission of claims for payment to the Federal Employee Health Benefits (FEHB) program using unsupported hearing loss-related diagnosis codes.

"We are pleased to reach the resolution announced today and plan to engage with the government regarding potential coverage of Eargo hearing aids for federal employees going forward," said Christian Gormsen, President and Chief Executive Officer.

Additionally, Eargo said it expects first-quarter Gross systems shipped to be about 5,770, 51% lower than 11,704 reported in the year-ago quarter.

Since the company has not yet filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2021, it is not in compliance with Nasdaq listing. Eargo has time until May 16, 2022, to regain compliance.