NEW YORK (GenomeWeb) – The City of Warren Police and Fire Retirement System has brought a class action lawsuit against molecular diagnostic firm Natera on behalf of the company's shareholders.
The plaintiff filed the securities class action suit in the Superior Court of the State of California, County of San Mateo in connection with Natera's initial public offering last July. Natera raised $180 million in its IPO.
The complaint alleges that the registration statement Natera filed in connection with its IPO "contained materially incorrect or misleading statements and/or omitted material information that was required to be disclosed."
Natera markets noninvasive prenatal and carrier screening tests, and is developing oncology tests. Last November, it reported third quarter 2015 revenues of $44.9 million and projected that its 2015 revenues would be between $180 million and $185 million.
The plaintiffs allege in the complaint that Natera "misleadingly represented" the state of its business, including a $20 million net loss the company experienced in the second quarter of 2015 before its IPO. That loss exceeded prior quarterly losses by as much as 3,700 percent since the launch of its Panorama NIPT, the complaint alleges.
In addition, the complaint alleges that Natera received revenues for less than half of the Panorama tests it accessioned, "indicating bleak prospects for the company's principal product — far from what was portrayed in the registration statement and roadshow for the offering."
Natera went public with an IPO price of $18 per share, but since then, its shares have fallen, and opened this morning at $7.07 per share.