Case Background:
On January 09, 2019, the initial complaint in this securities class action was filed against AxoGen, Inc. (“AxoGen” or the “Company”), and certain of AxoGen’s directors and officers, asserting violations of Sections 10(b) and 20(a) of the Securities Exchange Act. This is a federal securities class action on behalf of all persons and entities that purchased or acquired AxoGen securities between August 7, 2017 and December 18, 2018, both dates inclusive (the “Class Period”), including in the two public offerings the Company conducted in November 2017 and May 2018.
The complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, the complaint alleges that Defendants failed to disclose that: (1) the Company aggressively increased prices to mask lower sales; (2) the Company’s pricing alienated customers and threatened the Company’s future growth; (3) ambulatory surgery centers form a significant part of the market for the Company’s products; (4) such centers were especially sensitive to price increases; (5) the Company was dependent on a small number of surgeons whom the Company paid to generate sales; (6) the Company’s consignment model for inventory was reasonably likely to lead to channel stuffing; (7) the Company offered purchase incentives to sales representatives to encourage channel stuffing; (8) the Company’s sales representatives were encouraged to backdate revenue to artificially inflate metrics; (9) the Company lacked adequate internal controls to prevent such channel stuffing and backdating of revenue; (10) the Company’s key operating metrics, such as number of active accounts, were overstated; and (11) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
Current Status of Case:
On June 22, 2020, Lead Plaintiff filed a second amended complaint (the “Amended Complaint”). Defendants filed a Motion to Dismiss the Amended Complaint on August 6, 2020. On March 19, 2021, the Court granted the Defendants’ Motion to Dismiss the Amended Complaint with prejudice. On April 14, 2021, Lead Plaintiff appealed the Court’s dismissal to the United States Court of Appeals for the Eleventh Circuit. On August 1, 2022, the Eleventh Circuit affirmed the District Court’s decision dismissing the case. This action has concluded.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP: Jon Naji, Esq. (484) 270-1453; or via e-mail at info@ktmc.com. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.