Semler Scientific Reaches $29.75M Settlement with DOJ, Plans to Fund Payment with Bitcoin-Backed Coinbase Loan

Semler Scientific, a Nasdaq-listed healthcare technology company, has agreed to a tentative $29.75 million settlement with the U.S. Department of Justice (DOJ) to resolve allegations of federal anti-fraud law violations tied to the marketing of its flagship product, QuantaFlo, according to an April 15 filing with the U.S. Securities and Exchange Commission (SEC). The company plans to fund the settlement using a loan from Coinbase, secured by its bitcoin holdings.

The DOJ's investigation into Semler Scientific began in 2017 with a civil investigative demand (CID) related to the marketing of QuantaFlo, a point-of-care test for diagnosing peripheral arterial disease (PAD). The probe focused on whether Semler's marketing practices for QuantaFlo violated the False Claims Act (FCA), which prohibits submitting fraudulent claims for federal reimbursement, particularly through Medicare. According to SEC filings, Semler cooperated with multiple subsequent CIDs and initiated settlement discussions with the DOJ in February 2025. The tentative agreement, announced on April 15, aims to resolve all claims, though it remains subject to final approval.

In a strategic move, Semler Scientific disclosed in its April 15 8-K filing that it has entered a master loan agreement with Coinbase, a leading cryptocurrency exchange, to borrow cash and crypto assets using its bitcoin holdings as collateral. As of March 31, 2025, these holdings were valued at approximately $263.5 million, according to the filing, despite an unrealized loss of $41.8 million due to bitcoin's price fluctuations since 2025. The company plans to combine loan proceeds with its $9.9 million cash reserves to cover the $29.75 million settlement, preserving liquidity for other operations.

This approach could set a precedent as the first publicly reported instance of a listed company using bitcoin-backed loans to settle government penalties. However, the settlement's approval is not guaranteed, and failure to reach a final agreement could lead to further legal action, as cautioned in Semler's filing.

On April 15, Semler filed an S-3 registration statement with the SEC to raise up to $500 million through a mixed securities offering, including common stock, preferred stock, debt securities, and warrants. The proceeds are primarily intended for general corporate purposes, with a significant allocation for additional bitcoin purchases, as confirmed by Chairman Eric Semler's post: "We have reached a settlement in principle, EXCITED TO BUY MORE BTC!"