PHILADELPHIA, PA / ACCESSWIRE / February 3, 2023 / Berger Montague advises investors that a securities fraud class action lawsuit has been filed against NeoGenomics Inc. ("NeoGenomics") (NASDAQ:NEO) on behalf of those who purchased NeoGenomics securities between February 27, 2020 and April 26, 2022, inclusive (the "Class Period").
Investor Deadline: Investors who purchased or acquired NeoGenomics securities during the Class Period may, no later than February 6, 2023, seek to be appointed as a lead plaintiff representative of the class. For additional information or to learn how to participate in this litigation, please contact Berger Montague: James Maro at [email protected] or (215) 875-3093, or Andrew Abramowitz at [email protected] or (215) 875-3015 or visit: https://investigations.bergermontague.com/neogenomics-inc/
NeoGenomics provides cancer tests and testing services to doctors, clinics, hospitals, and pharmaceutical companies through its network of cancer testing laboratories in the United States, Europe, and Asia.
On November 4, 2021, NeoGenomics revealed that it was, "conducting an internal investigation with the assistance of outside counsel that focuses on the compliance of certain consulting and service agreements with federal healthcare laws and regulations" including "those relating to fraud, waste and abuse," and had "accrued a reserve of $10.5 million for potential damage and liabilities associated with the federal healthcare program revenue received spanning multiple years." Following this news, the price of NeoGenomics common stock fell $8.18 per share, or 17.6%, from $46.53 per share on November 3, 2021 to $38.35 per share at the close of trading on November 4, 2021.
Then, on March 28, 2022, NeoGenomics disclosed the departure of its CEO "effective immediately" and simultaneously reduced its financial guidance largely due to "higher than anticipated" costs. Following this news, the price of NeoGenomics common stock fell $5.30 per share, or 29.8%, from $17.79 per share on March 28, 2022 to $12.49 per share at the close of trading on March 29, 2022.
Finally, on April 27, 2022, NeoGenomics revealed that "higher payroll and payroll related costs" drove decreased profit and increased operating expenses, and admitted that its portfolio of cancer tests "is weighted to legacy" tests "while the market is moving towards larger, more comprehensive panels." NeoGenomics further admitted that it had "not kept up" with competitors that were offering more in-demand technologically advanced cancer tests. Following this news, the price of NeoGenomics common stock fell $0.41 per share, or 3.8%, from $10.85 per share on April 26, 2022 to $10.44 per share at the close of trading on April 27, 2022.
The complaint alleges that throughout the Class Period, Defendants misrepresented to investors and/or failed to disclose that: (i) NeoGenomics was anything but a "one-stop-shop" for cancer testing because it did not offer the most technologically advanced NGS tests, which led to a significant decrease in revenue as current and prospective customers went elsewhere for their testing needs; (ii) NeoGenomics's costs were not fixed because NeoGenomics needed to hire additional employees to process more complex customized testing demanded by customers utilizing NeoGenomics's outdated portfolio of tests, leading to operational challenges, decreased lab efficiency, and increased testing turnaround times; and (iii) NeoGenomics violated federal healthcare laws and regulations related to fraud, waste, and abuse.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Any member of the purported class may move the Court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
Berger Montague, with offices in Philadelphia, Minneapolis, Washington, D.C., and San Diego, has been a pioneer in securities class action litigation since its founding in 1970. Berger Montague has represented individual and institutional investors for over five decades and serves as lead counsel in courts throughout the United States.
James Maro, Senior Counsel
Andrew Abramowitz, Senior Counsel
SOURCE: Berger Montague