BENSALEM, Pa., Feb. 14, 2019 — Law Offices of Howard G. Smith reminds investors of the March 11, 2019 deadline to file a lead plaintiff motion in the class action filed on behalf of investors that purchased AxoGen, Inc. (“AxoGen” or the “Company”) (NASDAQ: AXGN) securities: (a) in connection with the Company’s November 2017 secondary public offering (“November SPO”); and/or (b) in connection with the Company’s May 2018 secondary public offering (“May SPO”); and/or (c) on the open market between August 7, 2017 and December 18, 2018, inclusive (the “Class Period”).
Investors suffering losses on their AxoGen investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to [email protected].
On December 18, 2018, Seligman Investments issued a report stating, among other things, that former employees allege the Company engaged in channel stuffing and backdating of revenue, that the number of active accounts may be overstated by a factor of ten, and that aggressive annual price increases had driven the Company’s revenue growth.
On this news, the Company’s share price fell $6.17 per share, or nearly 22%, to close at $21.36 per share on December 18, 2018, on unusually high trading volume.
The complaint filed in this class action 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, Defendants failed to disclose: (1) that the Company aggressively increased prices to mask lower sales; (2) that the Company’s pricing alienated customers and threatened the Company’s future growth; (3) that ambulatory surgery centers form a significant part of the market for the Company’s products; (4) that such centers were especially sensitive to price increases; (5) that the Company was dependent on a small number of surgeons whom the Company paid to generate sales; (6) that the Company’s consignment model for inventory was reasonably likely to lead to channel stuffing; (7) that the Company offered purchase incentives to sales representatives to encourage channel stuffing; (8) that the Company’s sales representatives were encouraged to backdate revenue to artificially inflate metrics; (9) that the Company lacked adequate internal controls to prevent such channel stuffing and backdating of revenue; (10) that the Company’s key operating metrics, such as number of active accounts, were overstated; and (11) that, 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.
If you purchased shares of AxoGen during the Class Period you may move the Court no later than March 11, 2019 to ask the Court to appoint you as lead plaintiff if you meet certain legal requirements. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you wish to learn more about this action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020 by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to [email protected], or visit our website at www.howardsmithlaw.com.
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