By Jim Finkle

(Reuters) – St. Jude Medical Inc warned on Tuesday that some of its implanted heart devices were at risk of premature battery depletion, a condition it said had been linked to two deaths.

News of the issue surfaced late on Monday when short-selling firm Muddy Waters tweeted a copy of a physician advisory on the matter from St. Jude, which agreed in April to sell itself for $25 billion to Abbott Laboratories.

The letter said problems with the lithium batteries that power the devices were rare and could be identified by patients using tools for monitoring battery levels at home.

Patients should seek immediate medical attention as soon as they get a low-battery alert from the monitoring devices, the U.S. Food and Drug Administration said, adding that St. Jude Medical had initiated a recall of the defibrillators.

St. Jude’s shares were down 2.4 percent at $79.35 in premarket trading on Tuesday, while Abbott’s were down 1.7 percent at $42.75. A spokesman for the drugmaker said it still expected to close the St. Jude deal by the end of the year.

The advisory comes as St. Jude is defending itself against unrelated allegations that its heart devices are riddled with defects that make them vulnerable to fatal cyber hacks.

Those claims were made by Muddy Waters and research firm MedSec Holdings. St. Jude has denied the allegations and sued both firms.

The FDA said on Tuesday its investigation into the cyber security vulnerabilities of the devices, including the Merlin@Home monitoring system, was continuing.

“Despite the allegations, at this time, the FDA strongly recommends that the Merlin@Home device be used to monitor the battery for these affected devices because the benefits of continued patient monitoring and the life-saving therapy these devices provide greatly outweighs any potential cybersecurity vulnerabilities,” the FDA said in a statement.

SMALL RISK

St. Jude said that out of nearly 400,000 devices manufactured through May last year, it had identified 841 failed implanted cardioverter defibrillators with lithium clusters, which can form after a device delivers electricity to the heart.

Lithium clusters sometimes cause battery power to deplete quickly, rendering devices unable to deliver doses of electricity when needed, St. Jude’s vice president of quality control, Jeff Fecho, said in a physician advisory.

“There have been two deaths that have been associated with the loss of defibrillation therapy as a result of premature battery depletion,” Fecho wrote in the letter.

Cowen & Co analysts said in a note that while such letters were never a positive, they were common in the industry and there was little risk to St. Jude’s business.

St. Jude advised physicians to replace devices with damaged batteries immediately, but cautioned against swapping out devices that were operating normally because of the potential for complications.

“While this risk is very small, we have provided doctors with information so that they can discuss the most appropriate course of action for each individual patient,” St. Jude’s chief medical officer, Mark Carlson, said in a statement.

St. Jude advised patients to check its website for details on which devices were affected. (http://www.sjm.com/batteryadvisory).

The site tells patients how they can monitor battery activity, look for vibrating alerts when batteries are low and connect to the Merlin.net remote monitoring service.

Battery-depletion advisories have issued in the past by Boston Scientific Corp and Medtronic Plc .

(Reporting by Jim Finkle in Boston and Ankur Banerjee and Natalie Grover in Bengaluru; Editing by Paul Tait and Ted Kerr)