NEW YORK, April 07, 2019 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Inogen, Inc. (“Inogen” or the “Company”) (NASDAQ: INGN) and certain of its officers and directors. The class action, filed in United States District Court, Central District of California, Western Division, and indexed under 19-cv-02112, is on behalf of a class consisting of all persons and entities, other than Defendants and their affiliates, who purchased or otherwise acquired publicly traded Inogen securities between November 8, 2017 and February 26, 2019, inclusive (the “Class Period”), seeking to pursue remedies under the Exchange Act.
If you are a shareholder who purchased Inogen securities during the class period, you have until May 6, 2019, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com . To discuss this action, contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
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Inogen is a medical device company specializing in the design and manufacture of portable oxygen concentrators, which are used to provide oxygen therapy to patients suffering from a range of respiratory conditions such as chronic obstructive pulmonary disease, chronic bronchitis, or emphysema. Home oxygen production has traditionally been done through a two-stage process. The process uses large stationary machines (the size of a basement dehumidifier or a college mini-fridge) to draw oxygen from the air and concentrate it and a separate portable oxygen tank to store the concentrated oxygen. The patient can then roll the separate oxygen tank along with them as they move around, providing the oxygen needed to breathe. Inogen manufactures and sells or rents smaller portable devices that concentrate oxygen and provide it directly to the patient, removing the need for two separate devices. Throughout the Class Period, Defendants made materially false and misleading statements regarding Inogen’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Inogen was overstating the true size of the total addressable market (“TAM”) for its portable oxygen concentrators, claiming it was upwards of 3 million people; (ii) Inogen was misstating the basis for its calculation of the TAM; (iii) Inogen was falsely attributing its sales growth to the strong sales acumen of its salesforce, when in reality it was due in large part to sales tactics designed to deceive its elderly customer base (including inducing them to purchase portable oxygen concentrators from Inogen at inflated prices by claiming that Medicare did not otherwise cover payment for such devices if obtained from other providers); (iv) as such, the growth in Inogen’s domestic business-to-business sales to home medical equipment (“HME”) providers was inflated, unsustainable and was eroding direct-to-consumer sales; (v) very little of Inogen’s business was actually coming from the more stable Medicare market; and (vi) as a result, Inogen’s public statements were materially false and misleading at all relevant times.
On November 6, 2018, Inogen released its third quarter 2018 financial results after the market closed. While the quarterly financial results were in line with expectations, defendants revealed that the growth in domestic business-to-business sales to HME providers had slowed precipitously to 32% from 56% in the second quarter of 2018. Inogen also reduced its guidance for fiscal 2018 adjusted EBITDA to $60 to $62 million from $65 to $69 million.
Following these disclosures, the price of Inogen common stock fell $37.44 per share, or over 19%, to close at $155.86 per share on heavy volume of 2.64 million shares traded, almost five times the average daily volume over the preceding five trading days.
Then, on February 26, 2019, after the close of trading, Inogen issued a press release announcing its fourth quarter and fiscal year 2018 (“4Q18” and “FY18”) financial results for the period ended December 31, 2018 and conducted a conference call with investors and stock analysts to discuss its business metrics and financial prospects. During the conference call, defendant Scott Wilkinson backtracked on the Company’s prior TAM estimate of 2.5 to 3 million patients, and blamed Inogen’s poor “domestic business-to-business sales” on “order activity [that] slow[ed] from one national home care provider in the fourth quarter of 2018.” Inogen also reported that its 4Q18 non-GAAP EBITDA was $10.5 million, 9.5% lower than fiscal 2017, and significantly reduced its previously provided fiscal 2019 net income guidance, blaming in large part the decline in its own stock price.
On this news, the price of Inogen common stock fell an additional $33.77 per share, or more than 24%, from a close of $140.06 per share on February 26, 2019, to a close of $106.28 per share on February 27, 2019.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
CONTACT: Robert S. Willoughby Pomerantz LLP rswilloughby@pomlaw.com 888-476-6529 ext. 9980
