electroCore, Inc. Class Action Lawsuit
- Company Name
- electroCore, Inc.
- Stock Symbol
- Class Period
- Purchasers of electroCore securities between June 22, 2018 and September 25, 2019 including purchasers pursuant to the June 22, 2018 initial public offering
- Motion Deadline
- November 25, 2019
- District of New Jersey
On September 26, 2019, the electroCore, Inc. class action lawsuit was filed charging electroCore, certain of its officers and directors, and the underwriters of its June 22, 2018 initial public offering (“IPO”) with violations of the Securities Exchange Act of 1934 and/or Securities Act of 1933. The electroCore class action lawsuit was commenced in the District of New Jersey on behalf of purchasers of electroCore securities between June 22, 2018 and September 25, 2019 (the “Class Period”) and/or purchasers pursuant to the IPO and is captioned Turnofsky v. electroCore, Inc., No. 3:19-cv-18400.
electroCore is a commercial-stage bioelectric medicine company with a non-invasive vagus nerve stimulation (“VNS”) therapy focused on the treatment of multiple conditions in neurology and rheumatology. electroCore’s lead product is gammaCore, a VNS device used for the acute treatment of pain associated with migraine headaches and the prevention of cluster headaches in adults.
In June 2018, electroCore completed its IPO, selling 5.2 million shares of its common stock at $15.00 per share pursuant to a Registration Statement filed with the U.S. Securities and Exchange Commission (“SEC”) in connection with the IPO.
The electroCore class action lawsuit alleges that during the Class Period and in the Registration Statement for the IPO, defendants made materially false and misleading statements and/or failed to disclose material adverse facts about electroCore’s business, operations, and prospects. Specifically, defendants failed to disclose that: (1) electroCore’s gammaCore device did not enjoy any advantages over other acute treatments for migraines and episodic cluster headaches and, as a result, doctors and patients were unlikely to adopt gammaCore over existing treatments; (2) electroCore’s voucher program was not effective to increase adoption of gammaCore; (3) electroCore lacked sufficient resources to successfully commercialize gammaCore; (4) electroCore’s business plan was not sustainable because electroCore lacked sufficient revenue to be profitable; (5) electroCore’s product registry and efforts were ineffective to initiate reimbursement policies by commercial payors for gammaCore, and the lack of reimbursement would materially impact the adoption and sales of gammaCore; (6) electroCore lacked sufficient clinical data demonstrating that gammaCore was effective and safe for migraine prevention; and (7) as a result, electroCore’s 510(k) submission for the use of gammaCore for migraine prevention was unlikely to be approved by the Food and Drug Administration (“FDA”). As a result of this information being withheld from the market, electroCore securities traded at artificially inflated prices of more than $17 per share during the Class Period.
On May 14, 2019, electroCore announced first quarter 2019 financial results that fell short of investors’ expectations, causing the price of electroCore shares to fall $1.58 per share, or nearly 29%, to close at $3.75 per share on May 15, 2019. Then on September 25, 2019, electroCore revealed the FDA had requested more information and analysis of clinical data for electroCore’s 510(k) submission seeking approval for “an expanded indication for use of gammaCore.” On this news, the price of electroCore shares fell $0.79 per share, or over 23%, to close at $2.57 per share on September 25, 2019, and subsequently fell to as low as $1.25 per share, a nearly 92% decline from the $15.00 per share IPO price.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased electroCore securities during the Class Period and/or common stock pursuant to the IPO to seek appointment as lead plaintiff in the electroCore class action lawsuit. A lead plaintiff will act on behalf of all other class members in directing the electroCore class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the electroCore class action lawsuit. An investor’s ability to share in any potential future recovery of the electroCore class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff of the electroCore class action lawsuit or have questions concerning your rights regarding the electroCore class action lawsuit, please provide your information here or contact counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at email@example.com. Lead plaintiff motions for the electroCore class action lawsuit must be filed with the court no later than November 25, 2019.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.