According to the law firm press release, Unilife designs and manufactures medical devices. The Company produces retractable syringes.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company's Unifill syringes failed to comply with the Food and Drug Administration's ("FDA") validation processes (2) the Company's Quality Management System failed to comply with FDA regulations; (3) the Company purposefully increased its purchases of Unifill component parts to make suppliers believe that Unilife was producing at increased volumes despite the fact that there was no customer demand or manufacturing capacity to support such purchases; and (4) as a result of the foregoing, the Company's statements were materially false and misleading at all relevant times.
On August 30, 2013, a former Unilife employee filed a complaint against the Company alleging that Unilife terminated his employment for reporting various regulatory violations to the appropriate authorities. For example, the employee alleges that the Company purposefully ran fake production at the Company's facility in order to lead visiting investors to believe that demand for the Company's products were high. Moreover, according to the employee, the Company purposefully suppressed internal reports demonstrating that the cost of developing the Company's syringes were higher than the price the Company was able to sell to customers.
On September 3, 2013, Forbes published an article concluding that the Company's main manufacturing facility was operating at 3% of capacity, or roughly 2 million syringes per annum. On this news, Unilife securities declined $0.52 per share or more than 14%, to close at $3.03 per share on September 4, 2013.
On January 7, 2014, the Plaintiff voluntarily dismissed this action, Brandt v. Unilife Corporation, et al., 13-CV-02690-JEJ, brought before the Middle District Court of Pennsylvania, without prejudice, as to all defendants.