Securities Class Action Filed Against OvaScience

WASHINGTON, D.C. — U.S. Market Advisors Law Group PLLC announces that a class action lawsuit has been filed against OvaScience, Inc.  (“OvaScience” or the “Company”) on behalf of purchasers of OvaScience common stock during the period between January 8, 2015 – March 26, 2015 (the “Class Period”). The action is filed in the District of Massachusetts and is captioned Fadi Dahhan v. OvaScience, Inc., et al., No. 17-cv-10511.
The complaint charges OvaScience and certain of its current and former officers and/or directors with violations of the Securities Exchange Act of 1934. OvaScience is a fertility company that claims to have discovered a therapy through which to increase in vitro fertilization (“IVF”) live birth rates by extracting mitochondria (a substance in egg cells which is generally viewed as the energy source of the egg) from egg precursor cells (immature egg cells found in the protective outer layer of a woman’s own ovaries) and injecting the same into the mature egg being utilized in the IVF process.  This process, the AUGMENTSM treatment (“AUGMENT”), is the Company’s sole marketable product.
The complaint alleges that during the Class Period, defendants issued false and misleading statements and/or failed to disclose material adverse facts about the Company’s business, operations and prospects.  In particular, defendants caused the Company to issue false and misleading statements and/or failed to disclose, among other things, that: (1) the science behind AUGMENT had not been scientifically validated; (2) the Company was unable to achieve the purported success rates it claimed; (3) the reasons why the Company moved its studies outside of the United States; and (4) that at all relevant times, the Company’s profitability and prospects were false and misleading.
Throughout the Class Period, defendants failed to disclose that the approximately 150 patients that had received OvaScience’s AUGMENT procedure in 2014 did not achieve a pregnancy success rate that was significantly higher than the rate achieved without the Company’s AUGMENT procedure.  As a result of the false and misleading statements issued by defendants, the price of the Company’s shares was artificially inflated throughout the Class Period.
The truth began to emerge on March 26, 2015 and March 28, 2015, when the Company issued two press releases that reported results of IVF clinics utilizing the AUGMENT procedure.  On March 26, 2015, the Company disclosed that of the twenty-six women who received the AUGMENT treatment in Canada, nine women achieved a pregnancy, a success rate of only approximately 35%.
On March 27, 2015, Gena Wang and Howard Liang, analysts for Leerink Partners LLC (“Leerink”) who covered the Company, stated that AUGMENT’s “[o]verall pregnancy rate appears less robust with a different denominator” and “the magnitude of AUGMENT benefit is unclear given no clear benchmarks and lack of standardized metrics.”
On March 28, 2015, the Company disclosed that of the eight women who received the AUGMENT treatment in Turkey, two achieved a pregnancy, a success rate of only 25%.  These success rates were comparable to the success rate achieved for women undergoing IVF without AUGMENT.  For example, according to the Centers for Disease Control and Prevention (“CDC”), in 2012, of the women studied who were 35 and under (and thus at an age where higher fertility rates are expected) who failed two prior IVF treatment cycles and received IVF with fresh non donor eggs or embryos, 33% were expected to deliver a live birth.
On March 30, 2015, Andrew S. Fein, an analyst for H.C. Wainwright & Co. (“H.C. Wainwright”), questioned the Company’s AUGMENT data pregnancy rate calculation stating that “the data raised interesting questions: (1) the use of embryo transfer as the denominator in calculating success rates….”  Fein went on to explain that viewed in the alternative, using the method utilized by the Society for Assisted Reproductive Technology (“SART”), the data would result in a 35% success rate as opposed to the 53% success rate OvaScience stated it had achieved.
After the truth was revealed concerning the AUGMENT treatment results, the Company’s shares plummeted $17.14 from $48.29 on March 26, 2015 to $31.15 on April 1, 2015, a loss of approximately 35% on unusually heavy volume of approximately 1.9 million shares.
On April 2, 2015, an analyst for Oppenheimer & Co. (“Oppenheimer”), Rohit Vanjani, opined that “[s]hares of OvaScience have traded down over 40% over the last week” because investors were stuck on one metric, AUGMENT’s reported pregnancy rate.  Vanjani also stated that “[w]e certainly understand why investors have put the pregnancy rate metric in focus.  Investors are still trying to understand if the AUGMENT technology works and if it will get adopted, and that metric is undoubtedly important.”
On this news, the Company’s shares again dropped from $35.06 on April 2, 2015 to close at $29.59 on April 7, 2015, a drop of over 15%, on usually heavy volume of approximately 2.1 million shares.
On April 16, 2015, Roddy Boyd of the Southern Investigative Reporting Foundation (“SIRF”), published an article entitled “Irreproducible Results, Inc.”  Critically, the SIRF article challenged the reported 53% clinical pregnancy rate observed from the Canadian physician’s data and stated, in pertinent part, “26 women got the [AUGMENT] treatment and, of them, 7 were able to successfully maintain a pregnancy for just under a 27 percent success rate.”
As a result of defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class members have suffered significant losses and damages.  The Company’s shares currently trade at under $2.00 per share and have since December 2016.
If you suffered a loss from OvaScience investments you have until May 29, 2017 to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery does not require that you serve as a lead plaintiff. Concerned shareholders who would like more information about their rights and potential remedies can contact U.S. Market Advisors Law Group PLLC.
About USMA
U.S. Market Advisors Law Group PLLC is a law firm based in Washington, D.C. The firm represents investors worldwide in U.S. securities class action lawsuits.
David P. Abel
(202) 274-0237

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