OAKLAND, Calif.--(BUSINESS WIRE)--Gibbs Law Group reminds investors it has filed the first and only class action lawsuit against NeoGenomics, Inc. (NASDAQ: NEO) and certain of its officers and directors on behalf of investors who purchased NeoGenomics securities from February 27, 2020, through April 26, 2022, inclusive. Investors have until February 6, 2023, to apply to be appointed as a lead plaintiff in the lawsuit.
To join the NeoGenomics class action lawsuit or to speak privately with our legal team about your rights in this class action lawsuit, click here or contact us at 510-876-9368.
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.
Allegations of Misconduct
According to the lawsuit, during the class period, Defendants made false and misleading statements or failed to disclose the following:
- Defendants represented to investors that it had a “comprehensive menu” of cancer tests with “every kind of testing modality that you can use for cancer, including some of the fast-growing new ones, like next-generation sequencing,” which positioned the Company as a “one-stop-shop” for pathologists and gave NeoGenomics “a competitive advantage” as a “go-to reference lab with a comprehensive menu for just about any kind of tests that you want to have done in cancer.”
- Defendants represented that NeoGenomics could “leverage” the supposedly “fixed cost” structure of its business to improve profitability as revenue increased and touted the Company’s “robust Compliance Program . . . to ensure compliance with the myriad of . . . laws, regulations and governmental guidance applicable to our business.”
The Truth Emerges
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.”
Next, 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.
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.” The Company further admitted that it had “not kept up” with competitors that were offering more in-demand technologically advanced cancer tests.
These disclosures caused the value of NeoGenomics stock to decline dramatically, resulting in significant harm to investors.
Since the lawsuit was filed, NeoGenomics subsidiary Inivata was also sued on December 21, 2022, for alleged patent infringement by genetic testing company Natera. NeoGenomics shares dropped 7% as a result, causing further harm to investors.
Then on January 19, 2023, NeoGenomics board member, David J. Daly, resigned, effective immediately.
About the NeoGenomics Class Action Lawsuit
The lawsuit, captioned Goldenberg v. NeoGenomics, Inc., No. 1:22-cv-10314, was filed in the U.S. District Court for the Southern District of New York and asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. If you suffered a loss in NeoGenomics, you have until February 6, 2023, to request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. Your ability to share in any potential future recovery does not require that you serve as a lead plaintiff.
What Should NeoGenomics Investors Do?
To join the class action or discuss your legal rights in the NeoGenomics class action lawsuit, visit our website or contact our securities team directly at 510-876-9368.
About Gibbs Law Group
Gibbs Law Group represents investors throughout the country in securities litigation to correct abusive corporate governance practices, breaches of fiduciary duty, and proxy violations. The firm has recovered over two billion dollars for its clients against some of the world’s largest corporations, and our attorneys have received numerous honors for their work, including “Best Lawyers in America,” “Top Plaintiff Lawyers in California,” “California Lawyer Attorney of the Year,” “Class Action Practice Group of the Year,” “Consumer Protection MVP,” and “Top Women Lawyers in California.”
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