Boston Scientific finds itself as the defendant in a proposed class action that looks to represent those who purchased or otherwise acquired securities in the company between February 26, 2015, and April 16, 2019.
The case itself stems from a more than 7.67-percent stock drop on April 17 that the plaintiff has linked to Boston Scientific’s apparent issuance of materially false and misleading statements in connection with its transvaginal mesh surgical repair products. According to the 33-page lawsuit, Boston Scientific, during the period outlined above, made false/misleading statements about and/or failed to disclose to investors that the products, whichthe FDA ordered the company to stop selling and distributing, were unsafe and that the company’s continued marketing and sale of the products before the FDA order was “unlikely to be sustainable.” Further, the case charges Boston Scientific withheld that it had sold vaginal mesh implants that contained “counterfeit or adulterated” resin products brought in from China.
Front and center in the lawsuit is Boston Scientific’s annual Form 10-K report filed with the SEC for the end of the 2015 fiscal year on February 14, 2016. Therein, the lawsuit says, Boston Scientific disclosed that it was hit with a class action that accused the company of using counterfeit or adulterated resin products imported from China in vaginal mesh implants, resulting in patient injuries. In the same 10-K disclosure, the suit says, Boston Scientific stated it had also been in contact with the United States Attorney’s office for the Southern District of West Virginia over its alleged use of fake Chinese imports.
More than two years later, the case continues, CBS aired a60 Minutespiece that highlighted Boston Scientific’s alleged used of counterfeit Chinese imports in surgical mesh products. Despite all this, the final straw as far as investors were concerned came when the FDA announced on April 16, 2019, that it had ordered all vaginal mesh manufacturers to immediately cease selling the products in the U.S.
“On this news,” the complaint reads, “Boston Scientific’s stock price fell $2.90 per share, or 7.67%, over the following two trading sessions, closing at $34.91 per share on April 17, 2019.”