Nasdaq-listed medical tech firm Semler Scientific is pressing forward with its aggressive Bitcoin strategy, even as it faces increasing legal scrutiny from federal authorities and shareholder advocates.
On Thursday, Bragar Eagel & Squire, P.C., a law firm specializing in securities litigation, announced an investigation into potential securities violations and unlawful conduct at Semler. The firm encouraged investors who suffered losses to come forward, raising concerns about the company’s disclosures and whether they align with regulatory standards.
This latest legal review adds to an already complex situation. In February, Semler revealed that the U.S. Department of Justice (DOJ) was considering enforcement action over its Medicare reimbursement practices. Despite this legal cloud, Semler has continued to allocate more capital to Bitcoin, recently purchasing an additional 455 BTC for $50 million—bringing its total holdings to 4,264 BTC worth approximately $466 million.
The move solidifies Semler’s position as one of the most Bitcoin-heavy public companies outside of industry giants like MicroStrategy. However, it also raises questions about the firm’s long-term priorities, risk controls, and strategic focus as it navigates serious federal scrutiny.
DOJ Investigation Casts Shadow Over Medical Reimbursement Practices
Federal pressure on Semler has been mounting for years. The DOJ’s ongoing probe into the company’s use and billing of its QuantaFlo cardiovascular testing device began in 2017. Since then, the agency has issued multiple civil investigative demands, including follow-ups in 2019, 2021, 2022, and 2023.
The investigation centers on whether Semler improperly billed government healthcare programs for the use of its diagnostic device. Although the company has tried to settle with authorities, discussions have reportedly stalled. Legal experts now suggest that a formal complaint may be on the horizon.
This prolonged legal uncertainty has posed reputational risks for Semler and could ultimately lead to costly financial penalties or restrictions—factors that weigh heavily on investor sentiment.
Bitcoin Strategy Continues Despite Regulatory Turbulence
Amid the intensifying legal spotlight, Semler’s corporate strategy has shifted in a striking direction. The company has embraced Bitcoin not just as a diversification tool, but as a core treasury asset.
While Semler’s stock (SMLR) declined 1.6% on Friday to $44.20, its performance has remained relatively resilient considering the ongoing DOJ threat. This may be partly due to a strong rebound in crypto markets, with Bitcoin recently hitting $108,915—up 16% over the past month despite day-to-day volatility.
Still, the firm’s decision to deepen its crypto exposure while under federal investigation has raised eyebrows across the financial and healthcare sectors. Investors are now weighing the benefits of Semler’s Bitcoin bet against the regulatory risks looming over its primary business model.
Quick Facts
- Bragar Eagel & Squire is investigating Semler Scientific for potential securities violations.
- The U.S. DOJ has been probing Semler’s billing practices since 2017 and may take enforcement action.
- Semler now holds 4,264 BTC worth about $466 million after a recent $50 million Bitcoin purchase.
- The company’s stock dipped 1.6% on Friday, while Bitcoin remains up 16% over the past month.
