NEW YORK, March 08, 2019 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Inogen, Inc. (“Inogen” or the “Company”) ( INGN) in the United States District Court for the Central District of California on behalf of those who purchased or acquired the securities of Inogen between November 8, 2017 and February 26, 2019, inclusive (the “Class Period”), seeking to recover damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder.
The Complaint alleges that Defendants failed to disclose that: (i) Inogen had overstated the true size of the total addressable market (“TAM”) for its portable oxygen concentrators and had misstated the basis for its calculation of the TAM; (ii) Inogen had falsely attributed 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; (iii) 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; and (iv) very little of Inogen’s business was actually coming from the more stable Medicare market. As a result of this information being withheld from the market, the price of Inogen common stock was artificially inflated to more than $282 per share during the Class Period.
On November 6, 2018, Inogen announced its third quarter 2018 financial results and, 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 and reduced Inogen’s guidance for fiscal 2018 adjusted EBITDA. As a result of this news, the price of Inogen common stock fell over 19%, or $37.44 per share, to close at $155.86 per share. Then, following the publication of detailed investigative reports by stock analysts on February 8, 2019 and February 12, 2019, which challenged, among other things, the size of Inogen’s actual TAM, the basis for its prior TAM claims, and the source of its Class Period sales growth, the price of Inogen common stock declined further to close at $138.05 per share on February 12, 2019.
Then, on February 26, 2019, after the close of trading, Inogen announced disappointing fourth quarter and fiscal year 2018 financial results and significantly reduced its previously provided fiscal 2019 net income guidance. Inogen’s CEO also 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 slowed from one national homecare provider. 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.
Investors who purchased or otherwise acquired shares during the Class Period should contact the Firm prior to the May 6, 2019 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at [email protected] or [email protected].
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