AxoGen shareholders filed a class action lawsuit alleging the human tissue company "aggressively" increased prices to disguise lower sales.
What you should know:
1. AxoGen's alleged price increases alienated customers, the lawsuit says. Shareholders claim the price hikes were especially infeasible for ASCs, which comprise a significant part of the market for human tissue products to remedy peripheral nerve damage.
The price increases therefore threatened the company's future growth, shareholders say.
2. Shareholders accuse AxoGen of making misleading positive statements about its business, operations and prospects. The company allegedly paid a small number of surgeons to generate sales and inflated metrics by encouraging sales representatives to backdate revenue.
3. Stakeholders also accuse AxoGen of offering sales representatives purchase incentives to to encourage channel stuffing, creating an inventory consignment model that "was reasonably likely to lead to channel stuffing."