What changed in this filing

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Item 1. Business

2021-02-26 compared with 2020-03-02 · 138 added, 56 removed, 613 unchanged (24% of the section changed)

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Early detection of heart rhythm disorders, such as atrial fibrillation (“AF”) and other clinically relevant arrhythmias, allows for appropriate medical intervention and helps avoid more serious downstream medical events, including stroke.

Since receiving clearance from the Food and Drug Administration (“FDA”) in 2009, we have provided the Zio service to over two million patients and have collected over 500 million hours of curated heartbeat data, creating what we believe to be the world’s largest repository of ambulatory ECG patient data.

Since receiving clearance from the Food and Drug Administration (“FDA”) in 2009, we have provided the Zio service to over three million patients and have collected over 750 million hours of curated heartbeat data, creating what we believe to be the world’s largest repository of ambulatory ECG patient data.

This data provides us with a competitive advantage by informing our proprietary deep-learned algorithms, which may enable operating efficiencies, gross margin improvement and business scalability.

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• a final quality assessment review of the data by our certified cardiographic technicians;

• an easy-to-read Zio report, which is a curated summary of findings that includes high-quality and clinically-actionable information which is sent directly to a patient’s physician and can be integrated into a patient’s electronic health record

• a scalable digital platform that includes an easy-to-read Zio report, which is a curated summary of findings that includes high-quality and clinically-actionable information which is sent directly to a patient’s physician and can be integrated into a patient’s electronic health record;

• a proprietary cloud-based digital information system, ZioSuite, that allows clinicians to connect via a web browser or mobile application for convenient online report interpretation and streamlined clinical workflows.

We refer to both the Zio AT monitor, and the Zio XT monitor herein as our Zio monitor(s), unless otherwise specified.

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In summary, we interpreted the clinical results to show that the Zio service is preferred by patients and allows for significantly longer continuous monitoring, improved clinical accuracy, increased detection of arrhythmias by physicians, and meaningful changes in clinical management.

Over two million patients have utilized the Zio service since its commercialization, and as of December 31, 2019, we have achieved both policy coverage and, where applicable, contracts with the majority of payors in the United States including the Centers for Medicare & Medicaid Services (“CMS”) and other government agencies.

Over three million patients have utilized the Zio service since its commercialization, and as of December 31, 2020, we have achieved both policy coverage and, where applicable, contracts with the majority of payors in the United States including the Centers for Medicare & Medicaid Services (“CMS”) and other government agencies.

Over 95% of patients in the U.S.

are able to access reimbursed Zio services through our third-party payor contracts, our IDTF participation status with CMS, and self-pay programs when excluding state Medicaid programs.

We have designed a comprehensive strategy to allow us to compete favorably in the ambulatory cardiac monitoring market, which includes capturing market share from existing monitoring devices as well as expanding the market through new indications.

We have designed a comprehensive strategy to allow us to compete favorably in the ambulatory cardiac monitoring market, which includes capturing market share from existing monitoring devices in the United States and international markets as well as expanding the market through new indications.

We expect to drive sales and margin growth in our business by expanding our sales organization, securing additional contracts with commercial payors, maintaining technology leadership through research and development, and continuing to build clinical evidence supporting the benefits of the Zio service.

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Typically, physicians prescribe event monitors for patients with lower acuity symptoms.

Mobile cardiac telemetry, also known as MCT, is another form of event monitor that usually uses wireless technology, such as a cell phone network, to transmit event data during the wear period for both patient-triggered and auto-detected events to a monitoring facility where the ECG data is analyzed and the facility determines if physicians should be notified of significant events.

Mobile cardiac telemetry ("MCT"), is another form of event monitor that usually uses wireless technology, such as a cell phone network, to transmit event data during the wear period for both patient-triggered and auto-detected events to a monitoring facility where the ECG data is analyzed and the facility determines if physicians should be notified of significant events.

Typically, physicians prescribe MCT for patients with higher acuity symptoms such as syncope, or fainting, that require more timely notification and actions.

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The FDA-cleared and CE-marked Zio service combines a wire-free, patch-based, 14-day wearable biosensor with a proprietary cloud-based data analytic platform to help physicians monitor patients and diagnose arrhythmias with a high degree of accuracy and confidence.

Since commercialization, over two million patients have utilized the Zio service, and we have collected over 500 million hours of heartbeats, creating what we believe to be the world’s largest repository of curated ambulatory ECG patient data.

Since commercialization, over three million patients have utilized the Zio service, and we have collected over 750 million hours of heartbeats, creating what we believe to be the world’s largest repository of curated ambulatory ECG patient data.

While wearing either the Zio XT or Zio AT monitor, patients have the ability to mark when symptoms occur by pressing a trigger button on the device, and separately recording contextual data like activities and circumstances in a written symptom diary or digitally via the myZio application.

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Additionally, we believe we have the first mover advantage in the long-term continuous market, particularly related to our efforts to secure both policy coverage and, where applicable, contracts with the majority of payors in the United States including CMS and other government agencies.

As of December 31, 2019, over 95% of patients in the U.S.

Over 95% of patients in the U.S.

are able to access reimbursed Zio services through our third-party payor contracts, our IDTF participation status with CMS, and self-pay programs when excluding state Medicaid programs.

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From our review, we determined that in 28% of cases observed in a clinical study by Rosenberg et al published in Pacing and Clinical Electrophysiology in March 2013, or the Rosenberg Study, the physician changed the patient’s clinical management after prescribing the Zio service as compared to a Holter monitor.

Additionally, the Zio service allows clinical staff to focus on more value-added activities by not requiring electrode changes or battery recharging during use, device cleaning and maintenance following use, and by reducing physician and hospital staff time needed to review and curate ECG data.

hospital staff time needed to review and curate ECG data.

Our 24/7 customer service team provides troubleshooting for patient-related issues, removing this burden from the physician practice.

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Our Zio service delivers a curated, concise, and clinically actionable report to the prescribing physician.

Through the Zio AT offering, which we fully launched commercially in October 2019, physicians can access the additional

capability of timely transmissions during the wear period.

Through the Zio AT offering, physicians can access the additional capability of timely transmissions during the wear period.

During the wear period, physicians will receive notifications and reports if there are significant events that meet pre-determined arrhythmia detection criteria.

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• unobtrusive and inconspicuous profile;

• proprietary adhesive backing designed to keep the Zio patch securely in place for the duration of the prescribed wear period

• proprietary adhesive backing designed to keep the Zio monitor securely in place for the duration of the prescribed wear period;

• water-resistant functionality, allowing patients to shower, sleep, and perform normal daily activities, including moderate exercise;

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With this option, the physician enrolls the patient and the patient receives the Zio monitor in the mail along with a detailed set of self-application instructions.

Additionally, the Zio service can be ordered directly through the physicians’ electronic health record system through the use of iRhythm’s Electronic Health Record ("EHR") integration service.

The Zio monitor is worn continuously by the patient for up to 14 days without the need for patient maintenance.

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Excerpts of these reports are included below to highlight the key features.

ZioSuite Web portal via desktop or mobile application

Up to 14-days continuous recording and storage

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In addition, we will pay Verily up to an aggregate of $12.75 million in additional milestone payments upon achievement of various development and regulatory milestones over the 24 months of the Development Agreement, which payments will be made in cash directly to Verily.

During the year ended December 31, 2020, we made $4.0 million in milestone payments to Verily.

The Development Agreement provides each party with certain licenses to use certain intellectual property of the other party for development activities in the field of AF screening, detection, or monitoring.

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Also, within existing accounts, we will continue to introduce our Zio service beyond cardiology and electrophysiology into other departments, including neurology, emergency rooms and primary care offices.

To enable this broader adoption within a hospital system, we have successfully interfaced the Zio ordering and report posting processes into a number of large health systems’ Electronic Health Record (“EHR”) systems.

To enable this broader adoption within a hospital system, we have successfully interfaced the Zio ordering and report posting processes into a number of large health systems’ EHR systems.

This seamless integration of Zio workflow processes into those already used within the IDN has proven to be a key factor in spurring growth within existing and new accounts and is an important part of our ongoing market penetration strategy.

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We have an initial presence in the United Kingdom with efforts underway to pursue national reimbursement.

In September 2020, we were named a winner of the Artificial Intelligence in Health and Care Award run by the Accelerated Access Collaborate as part of the NHS AI Lab.

This funding will bring the Zio service to selected NHS sites over a 3-year program measuring clinical, pathway and economic outcomes.

We also received positive guidance from the National Institute for Health and Care Excellence ("NICE") in December 2020 for the adoption of the Zio XT service which may facilitate for future support of the Zio service through the MedTech Funding Mandate.

We are also conducting diligence and prioritizing other geographies based on market size, regulatory pathway and reimbursement opportunity.

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◦ post-transcatheter aortic valve patients, estimated to be 100,000 annual procedures

• Advancing our technology offering and continuing to solidify our footprint in digital healthcare.

We continue to invest in building a unique, innovative product portfolio that addresses unmet needs in the ambulatory cardiac monitoring market.

Additionally, we believe that we have collected the world’s largest repository of ECG data from ambulatory patients, and we will continue to look for ways to utilize our

proprietary data to create value-driving opportunities in digital healthcare, such as expansion of indications for the Zio service, new therapeutic discoveries, development of an analytical engine for ambulatory consumer and other medical data, including the curation of third-party biosensor data and payor and provider decision support, as well as internal operating improvements.

• Advancing our product portfolio and core technology offering.

We continue to invest in building a unique, innovative product portfolio and digital platform that addresses unmet needs in the ambulatory cardiac monitoring market.

We will continue to invest in research and development efforts to further differentiate our biosensor, data analytics and reporting, information system and digital platform.

• Expanding our footprint in digital healthcare.

We believe that we have collected the world’s largest repository of ECG data from ambulatory patients, and we will continue to look for ways to utilize our proprietary data to create value-driving opportunities in digital healthcare, such as expansion of indications for the Zio service, new clinical insights, new therapeutic discoveries, payor and provider decision support, as well as internal operating improvements, We will also pursue development of our analytical engine for ambulatory consumer and other medical data, including the curation of third-party biosensor data in existing and new indications.

Reimbursement and Revenue from the Zio service

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In addition, a small percentage of institutions, which are typically hospitals or private physician practices, purchase the Zio service from us directly.

Third-party payors require us to identify the service for which we are seeking reimbursement by using a Current Procedural Terminology (“CPT”) code set maintained by the American Medical Association (“AMA”).

Third-party payors require us to identify the service for which we are seeking reimbursement by using a Current Procedural Terminology (“CPT”) code set maintained by the AMA.

For the year ended December 31, 2020, we received 84% of our revenue through third-party payors.

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Women over the age of 65 and men over 55 with certain risk factors were selected to participate based on information derived from claims data that placed them at a potentially increased risk of undiagnosed asymptomatic AF.

The one-year results were published in Heart Rhythm O2 in December 2020.

We interpreted the results to show that at one-year, AF was newly diagnosed in 6.6 percent of patients who were actively monitored by the Zio service versus 2.4 percent in the observational control group receiving routine care.

In addition to this primary endpoint to evaluate the difference in new AF diagnoses, clinical outcome data will be reported when the planned three year follow-up is complete.

An additional study underway examining early detection of AF using the Zio service in high risk patients is the Home-based Screening for Early Detection of AF, or SCREEN-AF.

This study is screening approximately 800 patients older than 75 years with hypertension.

Started in April 2015, the intervention group will undergo ambulatory screening for AF for two weeks with the Zio service utilized at baseline and again at three months, in addition to standard care for six months.

In November 2019, we announced our participation in a new, randomized, controlled study, GUARD-AF (Reducing stroke by screening for undiagnosed atrial fibrillation in elderly individuals), sponsored by the Bristol-Myers Squibb-Pfizer Alliance.

In addition to this primary endpoint to evaluate the difference in new AF diagnoses, active monitoring in an asymptomatic, moderate-risk population with the Zio service was associated with an increase in cardiology outpatient visits but also significantly lower rates of emergency department visits and hospitalizations over the one year following monitoring.

We concluded that these results suggest active monitoring with the Zio service can significantly reduce high-cost healthcare resource utilization and shift toward appropriate care settings at one year.

The three-year results were presented at the American Heart Association Scientific Sessions during the Late Breaking Science session in November 2020.

At the end of three years after the initial onset of monitoring:

• AF was newly diagnosed in 11.4% of those actively monitored with the Zio service versus only 7.7% of the control group (a statistically significant 48% improvement).

• The trial found the incidence rate of a cardiac event (stroke, myocardial infarction, systemic embolism, or death) was 8.4 per 100 person-years in people diagnosed with AF who underwent active monitoring, compared to the control group incidence rate of 13.8 per 100 person-years (a statistically significant improvement).

This data demonstrates the Zio service’s detection of AF in moderate-risk patients supported the prevention of serious cardiac events after diagnosis.

• Active monitoring with the Zio service also led to fewer hospitalizations for bleeding, the primary safety endpoint for the study (incidence rate of 0.32 per 100 person-years versus 0.71 per 100 person-years).

• Active monitoring also led to fewer total hospitalizations (12.9 versus 18.9 per 100 person-years).

We concluded the mSToPS study found that active screening for AF, as part of a prospective, pragmatic, direct-to-participant and nationwide study, was associated with a significant improvement in clinical outcomes and safety at three years relative to routine care

An additional study examining early detection of AF using the Zio service in high risk patients is the Home-based Screening for Early Detection of AF, or SCREEN-AF.

Initial results were presented at the combined European Stroke Organization / World Stroke Organization Conference in November 2020.

This randomized control trial recruited 822 patients older than 75 years with hypertension and no known AF from 49 family practice clinics across Canada and Germany between 2015 to 2019.

The intervention group included ambulatory screening for AF for two weeks with the Zio service utilized at baseline and again at three months, in addition to standard care for six months.

We interpreted the results to show AF was newly diagnosed in the screening group in 5.3% of subjects at six months compared to 0.5% in the standard of care control group.

A secondary outcome showed oral anticoagulation (OAC) therapy was prescribed for 75% of participants who had screen-detected AF.

We concluded that proactive screening and monitoring using the Zio service could increase AF detection by 10-fold over standard of care potentially prompting anticoagulation use.

In November 2019, we announced our participation in a randomized, controlled study, GUARD-AF (Reducing stroke by screening for undiagnosed atrial fibrillation in elderly individuals), sponsored by the Bristol-Myers Squibb-Pfizer Alliance.

The study seeks to determine if earlier detection of AF through screening in previously undiagnosed men and women ultimately impacts the rate of stroke, compared to usual standard medical care.

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Additional competitors, such as BioTelemetry, Inc.

and Preventice Solutions, Inc., offer ambulatory cardiac monitoring services and also function as service providers.

These competitors have also developed patch-based cardiac monitors that have received FDA and foreign regulatory clearances such as BioTelemetry’s ePatch and MCOT Patch.

We are also aware of some small start-up companies entering the patch-based cardiac monitoring market.

Large medical device companies may continue to acquire or form alliances with these smaller companies in order to diversify their product offering and participate in the digital health space.

recently acquired by Royal Philips, Preventice Solutions, Inc., being acquired by Boston Scientific, Inc.

and Bardy Diagnostics, Inc., being acquired by Hill-Rom Holdings, Inc.

offer ambulatory cardiac monitoring services and also function as service providers.

Recently, there has been increased acquisition activity and consolidation in our industry.

Many of our competitors have substantially greater financial, manufacturing, marketing and technical resources than we do.

Furthermore, many of our competitors have well-established brands, widespread distribution channels, broader product offerings and an established customer base.

These competitors have also developed patch-based cardiac monitors that have received FDA and foreign regulatory clearances.

We are also aware of some small start-up companies entering the patch-based cardiac monitoring market.

Large medical device companies may continue to acquire or form alliances with these smaller companies in order to diversify their product offering and participate in the digital health space.

We believe the principal competitive factors in our market include:

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To protect our proprietary rights, we rely on a combination of trademark, copyright, patent, trade secret and other intellectual property laws, employment, confidentiality and invention assignment agreements and protective contractual provisions with our employees, contractors, consultants, suppliers, partners and other third parties.

As of December 31, 2019 we owned, or retained an exclusive license to, seventeen issued patents from the U.S.

Patent Office, six issued patents from the Japanese Patent Office, two issued patents from each of the Australian, Canadian and European Patent Offices, and one issued patent from the Korean Patent Office:

As of December 31, 2020 we owned, or retained an exclusive license to, twenty issued patents from the U.S.

Patent Office, seven issued patents from the Japanese Patent Office, two issued patents from the Australian Patent Office, four issued patents from the Canadian Patent Office, four issued patents from the European Patent Offices, and two issued patents from the Korean Patent Office:

Issue Date Expiration Date

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USA 10,517,500 12/31/2019 5/12/2031

USA 10,555,683 2/11/2020 1/23/3034

USA 10,667,712 6/2/2020 10/30/2035

USA 10,813,565 10/27/2020 10/30/2035

Japan 5,203,973 2/22/2013 2/6/2027

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Japan 6,495,228 3/15/2019 5/12/2031

Japan 6,766,199 9/18/2020 5/12/2031

Australia 2,011,252,998 12/10/2015 5/12/2031

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Canada 2,797,980 8/18/2015 5/12/2031

Canada 2,898,626 5/12/2020 1/23/2034

Canada 2,966,180 6/9/2020 10/30/2035

Korea 10-1513288 4/13/2015 5/12/2031

European EP1981402 8/10/2016 2/6/2027

European EP2568878 7/25/2018 5/12/2031

As of December 31, 2019, we had nineteen pending patent applications globally, including three in the United States, five in the European Patent Office, four in Japan, two in each of Korea and Canada, and one in each of Australia, China and India.

Korea 10-2145450

8/11/2020 1/23/2034

Europe 1981402 8/10/2016 2/6/2027

Europe 2568878 7/25/2018 5/12/2031

Europe 2948050 5/12/2020 1/23/2034

Europe 3165161 5/6/2020 5/12/2031

As of December 31, 2020, we had nineteen pending patent applications globally, including eight in the United States, four in the European Patent Office, three in Japan, and one in each of Australia, Korea, China and India.

As of December 31, 2020, our trademark portfolio contained a U.S.

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This 17,558 square foot facility provides space for our assembly and production operations, including packaging, storage and shipping.

We believe our manufacturing facilities will be sufficient to meet our manufacturing needs for at least the next two years.

We believe our manufacturing facilities will be sufficient to meet our manufacturing needs for at least the next year, and plan to move into a new, larger facility in that time.

Our manufacturing operations are subject to regulatory requirements of the FDA’s Quality System Regulation (“QSR”) for medical devices sold in the United States, set forth at 21 CFR part 820, and the Medical Devices Directive 93/42/EEC (“MDD”), which is required for doing business in the European Union (“EU”).

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No additional follow up with the FDA was required and we believe that we are in substantial compliance with the QSR.

Circuit board components of the Zio XT and Zio AT monitors are provided by contract electronic manufacturers, Kimball Electronics, Inc., and Veris Manufacturing, Inc.

Circuit board components of the Zio XT and Zio AT monitors are provided by contract electronic manufacturers, Cal-Comp USA, Kimball Electronics, Inc., and Veris Manufacturing, Inc.

We have manufacturing service agreements with both providers that allow either party to terminate the agreement with 90 days prior written notice.

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Most Class II devices, including the Zio XT and Zio AT monitors, and the Zio ECG Utilization Service System, or the ZEUS System, require 510(k) clearance from the FDA in order to be marketed in the United States.

A 510(k) submission must demonstrate that the device is

substantially equivalent to a device legally in commercial distribution in the United States:

A 510(k) submission must demonstrate that the device is substantially equivalent to a device legally in commercial distribution in the United States:

(1) before May 28, 1976;

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The MDD sets out the basic regulatory framework for medical devices in the European Union.

In May 2020, the MDR, a more comprehensive regulatory framework, will replace the MDD.

In May 2020, the MDR, a more comprehensive regulatory framework, replaced the MDD.

The system of regulating medical devices operates by way of a certification for each medical device.

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We are also subject to enforcement by state attorneys general who were given authority to enforce HIPAA under HITECH.

To avoid penalties under the HITECH breach notification provisions, we must ensure that breaches of protected health information are promptly detected and reported within the company, so that we can make all required notifications on a timely basis.

To mitigate the risk of penalties under the HITECH breach notification provisions, we must ensure that breaches of protected health information are promptly detected and reported within the company, so that we can make all required notifications on a timely basis.

However, even if we make required reports on a timely basis, we may still be subject to penalties for the underlying breach.

In addition to the federal privacy regulations, there are a number of state laws regarding the privacy and security of health information and personal data that apply to us.

The compliance requirements of these laws, including additional breach

reporting requirements, and the penalties for violation vary widely, and new privacy and security laws in this area are evolving.

In addition to the federal privacy regulations, there are a number of state privacy laws, such as the California Consumer Privacy Act ("CCPA") and the California Privacy Rights Act ("CPRA"), that apply to us.

The compliance requirements of these laws, including additional breach reporting requirements, and the penalties for violation vary widely, and new privacy and security laws in this area are evolving.

Requirements of these laws and penalties for violations vary widely.

These new legislative and regulatory developments may impact our privacy and security strategy and our web-based and mobile assets.

If we or our operations are found to be in violation of HIPAA, HITECH, or their implementing regulations, we may be subject to penalties, including civil and criminal penalties, fines, and exclusion from participation in federal or state healthcare programs, and the curtailment or restructuring of our operations.

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In addition, the individual can be subject to an unlimited fine, as can commercial organizations for failure to prevent bribery.

There are also international privacy laws that impose restrictions on the access, use, and disclosure of health information.

There are also international privacy laws, such as the General Data Protection Regulation ("GDPR"), that impose restrictions on the access, use, and disclosure of health information.

All of these laws may impact our business.

Our failure to comply with these privacy laws or significant changes in the laws restricting our ability to obtain required patient information could significantly impact our business and our future business plans.

Our failure to comply with these privacy laws or significant changes in the laws, or judicial rulings interpreting these laws, may impact our ability to obtain required patient information and therefore could significantly impact our business and our future business plans.

Centers for Medicare and Medicaid Services (CMS)

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The ACA contains a number of provisions that impact our business and operations, some of which in ways we cannot currently predict, including those governing enrollment in federal healthcare programs and reimbursement changes.

The current presidential administration and Congress are expected to attempt to make sweeping changes to the current health care laws.

It is uncertain how modification or repeal of any of the provisions of the ACA, including as a result of current and future executive orders and legislative actions, will impact us and the medical device industry as a whole.

Any changes to, or repeal of, the ACA may have a material adverse effect on our results of operations.

We cannot predict what other health care

programs and regulations will ultimately be implemented at the federal or state level or the effect of any future legislation or regulation in the United States may have on our business.

As of December 31, 2019, we had 997 full-time employees.

None of our employees is represented by a labor union or is a party to a collective bargaining agreement, and we believe that our employee relations are good.

Corporate and Other Information

We were incorporated in Delaware on September 14, 2006.

Our principal executive offices are located at 699 8th Street, Suite 600, San Francisco, CA 94103, and our telephone number is (415) 632-5700.

Our website address is www.iRhythmTech.com.

References to our website address do not constitute incorporation by reference of the information contained on the website, and the information contained on, or accessible through, our website is not part of this document.

We make available, free of charge on our corporate website, copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statements, and all amendments to these reports, as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission pursuant to Section 13(a) or 15(d) of the Securities Exchange Act.

We also show detail about stock trading by corporate insiders by providing access to SEC Forms 3, 4 and 5.

This information may also be obtained from the SEC's on-line database, which is located at www.sec.gov.

Our common stock is traded on the NASDAQ Stock Market under the symbol “IRTC.”

We cannot predict what other health care programs and regulations will ultimately be implemented at the federal or state level or the effect of any future legislation or regulation in the United States may have on our business.

Human Capital

Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and new employees, advisors and consultants into our company.

The principal purposes of our cash and equity incentive plans are to attract, retain and reward personnel through the granting of cash-based and stock-based compensation awards, in order to increase stockholder value and the success of our company by motivating such individuals to perform to the best of their abilities and achieve our short- and long-term business goals.

Diversity, Inclusion & equal opportunity

We are committed to providing a work environment that is free of discrimination and harassment.

We are an equal-opportunity employer.

We make employment decisions on the basis of a person’s qualifications, and our business needs.

We believe in the richness and quality of a working environment that is informed by people from all walks of life and strive to create a genuinely inclusive environment.

We have implemented Diversity, Equal opportunity, and Inclusion action planning teams focused on analysis from diversity surveys and focus groups.

We have ongoing outreach efforts to recruit a diverse candidate pool and are building questions into our engagement survey to promote a diverse and inclusive environment.

We are committed to ensuring our team members are treated with fairness and respect.

We believe that a cooperative work environment, based in trust and mutual respect, is essential to our success.

We embrace the diversity of our workforce and celebrate the creative value added by individuals with differing backgrounds and encourage employee resource groups such as our Women in iRhythm group which focuses on leadership for women within our sales organization.

We expressly prohibit intimidation, hostility, harassment, discrimination, and other inappropriate behavior.

Furthermore, we expect associates to conduct themselves in a professional and dignified manner at all times;

in doing so, we seek to avoid making associates feel

uncomfortable at work.

We are building tools for managers to promote inclusive development, promotion and retention strategies.

As new employees join us, they learn more about our policies and culture through orientation and onboarding, our Employee Handbook, Code of Conduct, and compliance trainings.

These all provide guidance on how we expect to operate in order to foster diversity, equity and inclusion across our company.

Health, Safety, and Wellness

We are committed to maintaining a healthy, safe, and secure work environment that protects our employees and the public from harm.

Most of our employees are working from home and PPE has been provided to all employees coming into the office.

Where feasible, physical distancing has been implemented.

We use a multi-faceted approach to ensure the health and safety of our employees, from our Code of Conduct to our policies governing the way we act within and outside of our Company.

We comply with applicable health, safety, and environmental laws as well as related company policies and procedures.

We have a zero-tolerance policy against aggressive behavior, violence, direct and indirect threats, harassment, intimidation, and possession of weapons on company property.

Moreover, we strive to conduct our everyday business activities in an environmentally sustainable way through wellness programs, and webinars through our health insurance providers.

Total rewards

We offer an attractive mix of compensation and benefit plans to support our employees and their families’ physical, mental, and financial well-being.

We believe that we employ a fair and merit-based total compensation system for our employees.

Employees are generally eligible for medical, dental, vision and other comprehensive benefits, most of which become effective on their start date.

Below are some of the types of health and wellness related benefits offered to employees:

• Medical, dental and vision insurance

• Retirement plan with Company matching contribution feature

• Flexible Spending Accounts for medical expenses, childcare, parking and transit

• Health Savings Account (with employer contribution)

• Life insurance

• Short & long-term disability

• Paid time off and leave of absences

• Employee assistance program

It is important that all employees have an opportunity to have an ownership interest in our company, and there are several programs that provide the ability to own our stock.

Generally, more than 75% of our employees participates in at least one of our stock programs.

During their tenure with our company, all employees have an opportunity to receive an equity award, either upon hire and/or during an annual review process to recognize those with significant impact on achieving our goals.

Another program offered to all employees, whether part or full time, is the ability to participate in our Employee Stock Purchase Plan (“ESPP”).

Participants in the ESPP may purchase our stock at a 15% discount to market price.

We believe our discounted stock purchase program helps to build an ownership mentality amongst participating employees.

Talent attraction and retention

As we recruit top talent to join our team, we use job boards focused on outreach to underrepresented communities, including ethnic or racial, women, veterans, LGBTQIA, people with disabilities, and indigenous populations.

Workforce development

The growth and success of our employees is a top priority.

We are investing heavily to build in-house tools and resources to support managers and employees on the road to success and ongoing growth.

We offer a variety of training opportunities, whether focused on building vocational or management and leadership skills.

Our sales and clinical training programs equip employees to perform specialized work to support our patients and customers.

Our clinical training program consists of approximately 80 hours of training upon hire, plus ongoing training opportunities to ensure quality and consistency standards in patient care.

We have implemented Linkedin Learning to expand options for skill building and are creating a grow environment by asking all employees to have personal development plan.

Our commercial program provides 40 hours of product training and ongoing field and classroom education to prepare employees to support our customers with high quality service and support.

Our management and leadership skill building in 2020 was focused on coaching and core-manager skills.

Despite the challenges of COVID-19 on our work location, we facilitated several online courses around our core competencies and coaching practices, and we rolled out a toolbox on our intranet with tools for employees and managers across the employee lifecycle.

We conducted an Employee Net Promoted Score survey in 2019 and have ongoing surveys to engage employee feedback.

We encourage employee service days and have donation matching programs for company sponsored charities.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business