NEW YORK--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/foundationmedicine/) today announced that a class action has been commenced on behalf of purchasers of Foundation Medicine, Inc. (“Foundation”) (NASDAQ:FMI) common stock during the period between February 26, 2014 and November 3, 2015 (the “Class Period”). This action was filed in the District of Massachusetts and is captioned Mahoney v. Foundation Medicine, Inc., et al., No. 17-cv-11394.
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or David A. Rosenfeld of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at firstname.lastname@example.org. If you are a member of this class, you can view a copy of the complaint as filed at http://www.rgrdlaw.com/cases/foundationmedicine/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Foundation and certain of its officers and/or directors with violations of the Securities Exchange Act of 1934. Foundation develops, manufactures and sells genomic analysis diagnostic tests for solid and circulating cancers that are based on next-generation sequencing technology. The Company’s flagship products are the FoundationOne tumor profiling test and the FoundationOne Heme diagnostic test for blood cancers. The price for the tests can run upwards of $7,200 per test.
The complaint alleges that, during the Class Period, the Company made false and misleading statements and/or failed to disclose adverse information regarding the Company’s business and prospects. Specifically, the complaint alleges that defendants made false and/or misleading statements regarding: (i) the reimbursement process and likelihood of coverage for Foundation’s tumor tests by Medicare; and (ii) the Company’s financial guidance. As a result of these false statements, Foundation common stock traded at artificially inflated prices during the Class Period.
On July 29, 2015, the Company disclosed that it was not making the strides obtaining coverage it had claimed to have been making during the Class Period, and that, in reality, Foundation would receive no Medicare payments in 2015 for its tumor profiling tests due to a delay in receiving a local coverage determination from its regional Medicare Administrative Contractor. As a result of the delay, the Company slashed its 2015 financial guidance, which, unbeknownst to investors, was based on an assumption that Medicare approval was going to be obtained in 2015. On this news, the price of Foundation common stock fell $7 per share, or approximately 24%.
Then, on November 3, 2015, the Company disclosed a further revision to the already reduced number of clinical tests it expected to report for 2015. Following this disclosure, the price of Foundation common stock fell again, closing down $6.62 per share to close at $17.31 per share on November 4, 2015.
Plaintiff seeks to recover damages on behalf of all purchasers of Foundation common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.
Robbins Geller is widely recognized as a leading law firm advising and representing U.S. and international investors in securities litigation and portfolio monitoring. With 200 lawyers in 10 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For the third consecutive year, the Firm ranked first in both the total amount recovered for investors and the number of shareholder class action recoveries in ISS's SCAS Top 50 Report. Robbins Geller attorneys have shaped the law in the areas of securities litigation and shareholder rights and have recovered tens of billions of dollars on behalf of the Firm’s clients. Robbins Geller not only secures recoveries for defrauded investors, it also implements significant corporate governance reforms, helping to improve the financial markets for investors worldwide. Please visit http://www.rgrdlaw.com for more information.