Bristol County Retirement System v. QuidelOrtho Corporation f/k/a Quidel Corporation et al

On December 16, 2024, Labaton Keller Sucharow was appointed lead counsel in a securities class action against QuidelOrtho Corporation (QuidelOrtho or the Company) and certain executives (collectively, Defendants).

The action asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and U.S. Securities and Exchange Commission Rule 10b-5 promulgated thereunder, on behalf of all investors who purchased or otherwise acquired QuidelOrtho common stock between February 18, 2022, and April 1, 2024, inclusive (the Class Period).

QuidelOrtho provides tests for the detection and diagnosis of various respiratory diseases and other medical conditions.  Since the onset of the COVID-19 pandemic, the Company has generated a significant portion of its revenue through the sale of high-margin COVID-19 tests to government customers, healthcare providers (through its authorized distributors), and large retail pharmacy chains.

In December 2021, the Company announced that it had agreed to merge with Ortho Clinical Diagnostics Holdings plc (Ortho) through a transaction valued at approximately $6 billion, which closed in May 2022, shortly after the start of the Class Period.  During this time Defendants assured investors that the Company was poised to maintain a high-margin revenue stream from its respiratory business despite the decrease in COVID-19 infections.  The complaint alleges that throughout the Class Period, Defendants misled investors because, in contrast to their statements, they knew or deliberately disregarded and failed to disclose (a) that QuidelOrtho sold more COVID-19 tests to its distributors and pharmacy chain customers than they could resell to healthcare providers and end customers; (b) that excess inventories of COVID-19 tests existed throughout the supply chain; (c) that, consequently, QuidelOrtho’s distributors and pharmacy chain customers were poised to significantly reduce their COVID-19 test orders; and (d) that undisclosed problems created a heightened risk that a new respiratory test, the Savanna RVP4 Test, would experience a delayed commercial launch in the United States.  The truth was revealed when QuidelOrtho reported underwhelming results for its fourth quarter 2023, largely attributed to lower COVID-19 revenues.  Then, on April 2, 2024, QuidelOrtho announced that it had withdrawn its FDA 510(k) submission for approval to sell the Savanna RVP4 Test in the United States after recent data did not meet expectations, leading to further declines in the price of its stock.  

The case is Bristol County Retirement System v. QuidelOrtho Corporation f/k/a Quidel Corporation et al, No. Case 1:24-cv-02804-MKV (S.D.N.Y.).  Labaton Keller Sucharow represents Lead Plaintiff Central States, Southeast and Southwest Areas Health and Welfare Fund, and Teamsters Local 710 Pension Fund (collectively the Teamsters Funds).

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