Becton, Dickinson and Company Class Action Lawsuit
- Company Name
- Becton, Dickinson and Company
- Stock Symbol
- Class Period
- November 5, 2019 to February 5, 2020
- District of New Jersey
On February 27, 2020, the Becton, Dickinson and Company securities class action lawsuit was filed charging Becton, Dickinson and certain of its officers with violations of the Securities Exchange Act of 1934. The Becton, Dickinson securities class action lawsuit was commenced in the District of New Jersey on behalf of purchasers of Becton, Dickinson securities between November 5, 2019 and February 5, 2020 (the “Class Period”) and is captioned Stephen Kabak, as Trustee of The Stephen Kabak & Joy Schary Living Trust v. Becton, Dickinson and Company, et al., No. 20-cv-02155.
Becton, Dickinson is a medical technology company that develops, manufactures, and sells a broad range of medical supplies, devices, laboratory equipment, and diagnostic products. Becton, Dickinson’s Alaris infusion system is a large volume infusion pump that continuously or intermittently delivers fluids, medications, blood, and blood products to adult, pediatric, or neonatal patients.
The Becton, Dickinson securities class action lawsuit alleges that during the Class Period, defendants made false and misleading statements and/or failed to disclose that certain of Becton, Dickinson’s Alaris infusion pumps had experienced software errors and alarm prioritization issues, which would result in Becton, Dickinson investing in remediation efforts to address these product issues rather than a software upgrade to “make enhancements,” and that Becton, Dickinson was reasonably likely to face regulatory delays in connection with the software remediation and would have to recall certain of its Alaris infusion pumps. As a result of this information being withheld from the market, Becton, Dickinson securities traded at artificially inflated prices during the Class Period, with the price of Becton, Dickinson stock reaching a high of more than $285 per share.
Then on February 6, 2020, Becton, Dickinson lowered its fiscal 2020 guidance, announcing that it expected revenue to increase by only 1.5% to 2.5%, which “reflect[s] the impact of the remediation effort and anticipated loss of sales of the Alaris infusion system.” According to Becton, Dickinson, the software remediation plan for the Alaris infusion system “will require additional regulatory filings beyond what Becton previously anticipated.” Moreover, Becton, Dickinson disclosed that it had recalled certain of its Alaris infusion systems and that it would only sell the infusion pump to existing customers who demonstrate a medical necessity. On this news, Becton, Dickinson’s share price fell $33.74 per share, or nearly 12%, to close at $252.25 per share on February 6, 2020.
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