Life Science Company OvaScience Facing Securities Lawsuit Over 2015 Offering

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A proposed class action lawsuit alleging violations of federal securities law has been filed against OvaScience, a number of the company’s senior executives and directors, and each of the investment banks that acted as underwriters for a January 8, 2015 secondary offering. In the offering, the suit claims, the defendants sold 2.3 million shares of stock at a price of $50 per share, with the investment banks also having the option of buying up to 345,000 additional shares. According to the suit, the defendants made false statements and omitted certain facts from documents associated with the offering, including the registration statement. In particular, the suit continues, the documents failed to disclose that the science behind fertility treatment Augment was untested and questionable, patients who received the treatment in 2014 did not get pregnant at a higher rate than those not undergoing the procedure, and that the company was “far from being profitable, or even approaching profitability.” As such, the suit claims the price of the life science company’s shares was artificially and materially inflated in the offering. Allegedly, OvaScience’s stock has plummeted by over 97% since the offering, and as of the date marked on the complaint, the stock is trading at below $1.50 per share.