BioScrip Inc (BIOS, Financial), a New York-based national provider of infusion and home care management solutions, announced last month the sale of $62.5 million in Series A Convertible Preferred Stock to Coliseum Capital Management, LLC, and related funds.
The price of shares dropped 10% the day after the announcement; now two law firms – the Shuman Law Firm and Kirby McInerney LLP – are investigating possible claims against BioScrip officers and directors stemming from a Department of Justice press release that disclosed that BioScrip had agreed to relinquish $15 million for its cooperation in a kickback plan with Novartis Pharmaceuticals, Inc.
The Department of Justice press release was issued in January 2014.
Following that revelation, BioScrip stockholders filed a class-action suit alleging that BioScrip had made false and misleading statements in its public Securities Exchange Commission filings. The defendants’ motion to dismiss the complaint was denied on March 31, and the case is slated to go to trial.
Guru Mario Gabelli (Trades, Portfolio), the founder, chairman and CEO of Gabelli Asset Management Company Investors, is one of two gurus we follow who currently have BioScrip in their portfolios. Gabelli first added shares of BioScrip to his portfolio in 2012; he contributed more shares to his stake twice after BioScrip’s announcement (on top of another purchase about a week before the announcement). His most recent acquisition came in the last week of March when he purchased nearly 1 million shares for an average price of $4.32 per share.
Gabelli added a modest stake in BioScrip to his portfolio in September 2012, purchasing 14,000 shares for an average price of $7.68. It remained a rather small holding in his portfolio until he acquired 761,375 shares for an average price of $7.72 in the first quarter of 2014.
The other guru who has a stake in BioScrip is Ron Baron (Trades, Portfolio). Baron’s history with BioScrip isn’t as extensive as Gabelli’s, and his holdings aren’t as large. He bought his stake in BioScrip in the fourth quarter of 2013 and last added to it in the fourth quarter of 2014. Baron’s stake is currently 345,500 shares.
BioScrip has a P/E of 0, a Price/Book of 1.5 and a Price/Sales of 0.3. It has a market cap of $328.7 million and an enterprise value of $749.64 million.
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