Please complete this form relating to your transactions for CareDx, Inc. (NASDAQ: CDNA) common stock between February 24, 2021, and May 5, 2022, inclusive (the “Class Period”).
You may also contact Jon Naji, Esq. (484) 270-1453; or you may submit your information via email at firstname.lastname@example.org; or you may click here to print a PDF of this form.
CareDx investors may receive additional information about the case by clicking the link "Submit Your Information" above. If you are a member of the class described below, you may no later than July 22, 2022 move the Court to serve as lead plaintiff of the class, if you so choose.
A class action lawsuit has been filed on behalf of those who purchased or acquired CareDx, Inc. (“CareDx”) (NASDAQ: CDNA) common stock between February 24, 2021, and May 5, 2022, inclusive (the “Class Period”).
CareDx is a diagnostics company that provides services and products to the organ transplant recipient community, offering diagnostic testing services, products, and digital healthcare software for transplant patients and care providers. The information gathered through CareDx’s surveillance and tests purportedly enables clinicians to make treatment decisions in the event of signs of organ rejection. During the Class Period, testing services for kidney and heart transplant recipients was CareDx’s largest segment, representing at least 85% of its total revenues since the beginning of 2020. CareDx’s AlloSure® blood test for transplant recipients was, and is, its primary source of revenue. The defendants also emphasized to investors the success of CareDx’s RemoTraC service – a remote, home-based, blood-drawing service that CareDx launched in response to the Covid-19 pandemic – as part of the “winning formula.”
The Class Period commences on February 24, 2021 when the defendants reported a 51% year-over-year increase in total revenue, with testing services revenue increasing from $104.6 million in 2019 to $163.5 million in 2020. The defendants presented the testing services segment as CareDx’s “growth driver” for which “demand continued unabated.” Moreover, the defendants described CareDx’s testing services segment as having “a winning formula” that would allow it to capture a massive total addressable market.
The truth began to emerge on October 28, 2021, when CareDx filed its quarterly report for the third quarter of 2021 on a Form 10-Q that reported that: (1) CareDx had “recently received” a civil investigative demand (“CID”) from the U.S. Department of Justice (“DOJ”) requesting CareDx produce documents in connection with the DOJ’s False Claims Act investigation; (2) CareDx received a subpoena from the U.S. Securities and Exchange Commission (the “SEC”) in relation to an investigation by the SEC “in respect to matters similar to those identified in the CID, as well as certain of our accounting and public reporting practices;” and (3) CareDx received an information request from an unnamed state regulatory agency. Following this news, the price of CareDx shares declined more than 27%, from a closing price of $70.34 per share on October 28, 2021, to a closing price of $51.00 per share on October 29, 2021.
Then, after the markets closed on May 5, 2022, CareDx announced its results for the first quarter of 2022. The defendants reported testing services revenue that fell well short of analysts’ expectations and yet another decline in average sales price in which CareDx’s average price declined by approximately 4.9% versus the last quarter of 2021, or what one analyst described as “another big deterioration in price.” Following this news, the price of CareDx stock declined 18.5%, from a closing price of $31.66 per share on May 5, 2022, to a closing price of $25.87 per share on May 6, 2022.
The complaint alleges that, throughout the Class Period, the defendants mislead investors and/or failed to disclose that: (1) the defendants had engaged in a variety of improper and illegal schemes to inflate testing services revenue and demand, including pushing a surveillance protocol through inaccurate marketing materials, offering extravagant inducements or kickbacks to physicians and other providers, and improperly bundling expensive testing services with other blood tests as part of the RemoTraC service; (2) these practices, and others, subjected CareDx to an undisclosed risk of regulatory scrutiny; (3) these practices rendered CareDx’s testing services revenue reported throughout the Class Period artificially inflated; and (4) as a result, the defendants’ positive statements about CareDx’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.
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. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. 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.
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 email@example.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.