TranS1 face subpoena in fraud probe

MassDevice reports:

The U.S. Dept. of Health & Human Services sent a subpoena to TranS1 Inc. (NSDQ:TSON) seeking documents for its probe into the spine surgery firm.

The Wilmington, N.C.-based company revealed the Oct. 6 subpoena in a regulatory filing yesterday.

“The subpoena seeks documents for the period January 1, 2008, through October 6, 2011,” according to the filing. “The company is cooperating with the government’s request and is in the process of responding to the subpoena. The company is unable to predict what action, if any, might be taken in the future by the Department of Health and Human Services, Office of Inspector General or other governmental authorities as a result of the matters related to this subpoena or what impact, if any, the outcome of these matters might have on its consolidated financial position, results of operations, or cash flows. No claims have been made against the company at this time.”

TranS1 landed raised $18.3million of a hoped-for $20 million round through public sales of common stock.

The company reported heavy losses in during the second quarter ended June 30, posting a 26 percent decrease in sales to $5.3 million, compared to $7.2 million during the same period last year.

Losses widened 19 percent to $4.3 million, or 21 cents per diluted share, compared to $3.6 million, or 18 cents per diluted share in Q2 2010.

Source: MassDevice