An FDA warning letter has been received by Owlet for not getting proper approval of the Smart Sock baby monitor. This comes as the company has touted the Smart Sock as a baby monitor in which babies' heart rates and oxygen levels are tracked to protect them from irregular heartbeats and SIDS. However, to do this, Owlet would have had to receive medical clearance from the FDA as tracking heart rates and oxygen levels classifies the product as a medical device, something of which was never done.
Last week, news broke that the Owlet Smart Sock, which has become a parental favorite among the baby products on the market had not received the proper medical clearance from the FDA to sell the product with the ability to track heart rates and oxygen levels of babies.
According to MarketWatch, the company was told by the FDA to "cease commercial distribution of the Smart Sock for uses in measuring blood oxygen saturation and pulse rate where such metrics are intended to identify or diagnose desaturation and bradycardia using an alarm functionality to notify users that measurements are outside of preset values."
Owlet rolled out the Smart Sock baby monitor in 2015. Since that time, the company website has amassed scores of parents who claim everything from they feel more secure putting their babies to sleep using the product to the product saving their babies' lives.
However, according to Forbes, because there was never a backing from the FDA, doctors, and hospitals-at-large would not recommend the Sleep Sock to patients given that it has not been put through the proper testing to receive the administration's approval.
In 2017, the founders of the company told the publication that they were applying for FDA medical clearance on the Sleep Sock. That though did not happen. Instead, the company forged ahead without FDA or the American Academy of Pediatrics approval, while stating that the Sleep Sock accurately monitored heart rate and oxygen levels in users.
While Owlet stands by the fact that the Sleep Sock has been tested by third-party groups which confirm their claims of precise monitoring of babies to help protect against SIDS, according to Markets Insider, that is not good enough to receive medical clearance from the FDA.
As a result of the warning letter from the FDA, the Owlet website no longer claims to monitor the oxygen levels or heart rate of the babies who use the Sleep Sock. Instead, the device, which costs $299, is now being described as a way to track "sleep trends" in order to "build healthy sleep habits."
With the news that Owlet had not received the proper medical clearance from the FDA for its wildly popular Smart Sock, the stock has fallen nearly 25 percent, since that announcement last week. And with no clearance being made available to the company for the foreseeable future, the outlook looks bleak for shareholders until this issue can be resolved and potentially for Owlet as well.
Source: Market Insider, MarketWatch, Forbes, Owlet