Neovasc Inc (US) (NASDAQ:NVCN) is currently under investigation from several law firms, on charges of potential misrepresentations. The representatives at the Goldberg Law PC stated that they are investigating whether or not the company’s officers violated any SEC laws, by misleading the investors through false information. The investigation comes after a jury in Boston ruled against Neovasc, during a legal battle with CardiAQ.
CardiAQ had filed for relief for three of the company’s six asserted trade secrets, breach of duty of honesty and a breach of contract. The jury ruled that a total of $70 million were to be awarded to CardiAQ as relief for its trade secrets, but there was no damage in contractual claims. Representatives of Goldberg Law stated that they would investigate these media reports to check if NVCN was in violation of Sections 10(b) and 20(a) of the SEC Act of 1934.
The CEO of NVCN, Alexei Marko, expressed regret at the jury announcement, stating that the management would be exploring its options and would potentially begin the appellate process. He also reaffirmed that the company remains focused on its efforts to advance its cardiovascular products. The CEO particularly pointed towards refractory angina and mitral regurgitation as the two main unmet heart diseases, on which NVCN would be focusing.
For its 1Q2016, Neovasc reported revenues of $2.01 million, with a loss of $10.88 million. Furthermore, the company had reported a widening of its gross margins, which it stated was responsible for the earnings decline. Neovasc’s revenues were down by 12.95% on a year-over-year basis, while net earnings recorded a decline of 119.28%. It should be noted here that the 1Q2016 was filed prior to the jury’s result. As such, the company’s earnings are expected to further decline, owing to the loss of its transcatheter mitral valve technology and the Tiara.
Neovasc Inc (US) (NASDAQ:NVCN) completed the June 7 trading session, with a loss of 6.02% in terms of share value, to reach a close at $0.423.