WILMINGTON, Del.--(BUSINESS WIRE)--Rigrodsky & Long, P.A. announces that it has launched an investigation on behalf of the shareholders of Pacific Biosciences of California, Inc. (“PACB” or the “Company”) (Nasdaq: PACB) for possible violations of the Federal securities laws.
If you are a PACB shareholder who purchased your stock pursuant or traceable to the Company’s Initial Public Offering on October 27, 2010 (the “IPO”) or purchased PACB common stock between October 27, 2010 and September 21, 2011 and would like to learn more about our investigation, or if you wish to discuss these matters or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Timothy J. MacFall, Esquire or Noah R. Wortman, Case Development Director, of Rigrodsky & Long, P.A., 919 N. Market Street, Suite 980, Wilmington, Delaware 19801, by telephone at (888) 969-4242, or by e-mail to info@rigrodskylong.com,or at: http://investigations.rigrodskylong.com/pacific-biosciences-of-california-inc-pacb/.
PACB is a development stage company that develops, manufactures, and markets an integrated platform for genetic analysis. The Company engages in commercializing a platform, single molecule, real-time technology (SMRT) for the detection of biological events.
The investigation surrounds the Company’s failure to disclose in connection with its IPO that, contrary to the PACB’s claim that its RS system had a 99.99% base calling accuracy rate, the RS’s raw-read accuracy rate was only 80%-84% such that would-be customers would have to sacrifice long read length to obtain increased raw-read accuracy, that countless insidious bugs in the RS system caused it to be highly unreliable and crash often, and that significant negative feedback had been received from limited production users of the system.
On August 5, 2011, J.P. Morgan issued a report cutting PACB’s rating from Overweight to Neutral, stating that due to a slower ramp-up in orders now being expected it was “lowering [its] 2012 projection from systems recognized from 170 to 90” and is now “not forecast[ing] operating profitability until after 2015.” In reaction to this news, PACB stock plunged 34% to close at $6.50 per share on August 5, 2011.
The very next month, on September 21, 2011, PACB was forced to disclose that its cash burn was threatening its operations so severely, that as a result it was laying off 130 employees and it would incur $5 million in separation expenses related to the lay off of these employees. In reaction to this news, PACB’s stock again plummeted another 25% to close at $4.25 per share on September 21, 2011.
Rigrodsky & Long, P.A., with offices in Wilmington, Delaware and Garden City, New York, regularly litigates securities class, derivative and direct actions, shareholder rights litigation and corporate governance litigation, including claims for breach of fiduciary duty and proxy violations in the Delaware Court of Chancery and in state and federal courts throughout the United States.
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