electroCore, Inc.
| Company Name | electroCore, Inc. |
| Stock Symbol | ECOR |
| Class Period | June 22, 2018 to September 25, 2019 |
| Lead Plaintiff Motion Deadline | November 25, 2019 |
In June 2018, electroCore completed its initial public offering (“IPO”) in which it sold 5.2 million shares of its common stock at $15.00 per share.
On May 14, 2019, the Company announced first quarter 2019 financial results that fell short of investors’ expectations, reporting $410,000 net sales and operating loss of $14.2 million.
On this news, the Company’s share price fell $1.58, nearly 29%, to close at $3.75 per share on May 15, 2019, thereby injuring investors.
Then, on September 25, 2019, the Company revealed that the U.S. Food and Drug Administration requested more information and analysis of clinical data for electroCore’s 510(k) submission, which seeks an expanded indication for the use of gammaCore, the Company’s treatment for pain associated with episodic cluster headache.
On this news, the Company’s share price fell $0.79, over 23%, to close at $2.57 per share on September 25, 2019, thereby injuring investors further.
By the commencement of this action, electroCore stock was trading as low as $1.25 per share, a nearly 92% decline from the $15 per share IPO price.
The complaint filed in this class action alleges Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company’s lead product, gammaCore, did not enjoy any advantages over other acute treatments for migraines and episodic cluster headaches; (2) that, as a result, doctors and patients were unlikely to adopt gammaCore over existing treatments; (3) that the Company’s voucher program was not effective to increase adoption of gammaCore; (4) that the Company lacked sufficient resources to successfully commercialize gammaCore; (5) that the Company’s business plan and strategy was not sustainable because electroCore lacked sufficient revenue to be profitable; (6) that the Company’s product registry and efforts were ineffective to initiate reimbursement policies by commercial payors for gammaCore; (7) that the lack of reimbursement would materially impact adoption and sales of gammaCore; (8) that the Company lacked sufficient clinical data demonstrating that gammaCore was effective and safe for migraine prevention; (9) that, as a result, the Company’s 510(k) submission for the use of gammaCore for migraine prevention was unlikely to be approved by the FDA; and (10) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
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