The Securities and Exchange Commission on Tuesday charged the former CEO of Stimwave, a company that sold devices containing dummy pieces of plastic, with defrauding investors out of $41 million.
Laura Perryman led Stimwave, which sold nerve stimulation devices to combat pain, from 2010 to 2019, when the fraud came to light. Under her leadership, Stimwave warped the design of the device to better align with insurance codes, resulting in unnecessary plastic components that allowed the company to sell their products for thousands of dollars more than they otherwise could. From 2017 to 2020, the company implanted nearly 8,000 patients with these devices.
STAT published new details about the Stimwave story in May, learning from former employees that Perryman broke into Stimwave’s Florida headquarters to steal back devices after her termination in 2019. The fraud laid bare the limits of the Food and Drug Administration’s device surveillance system, doctors’ ability to scrutinize device effectiveness, and how impossible it is for patients to get answers about the implants they receive.