Scott+Scott Attorneys at Law LLP(“Scott+Scott”), a shareholder litigation firm, alerts investors that it is investigating whether GeneDx Holdings Corp. (“GeneDx” or the “Company”) (NASDAQ: WGS) or certain of its officers and directors issued misleading and false statements and/or failed to disclose information material to investors in violation of federal securities laws.
GeneDx performs genetic tests for rare diseases, such as whole exome and genome tests (“E&G tests”). In the last two years, the Company has more than doubled the volume of E&G tests performed each quarter, and quarterly revenue from E&G tests has more than tripled.
On February 5, 2025, Grizzly Research, a short seller, released a report (the “Report”) in which a former GeneDx employee alleged that the Company had engaged in an illegal practice known as “code stacking,” by which the Company billed insurers for additional services the Company did not perform. The Report also alleged that code stacking inflated the Company’s revenue by 25%. On this news, the price of the Company’s stock fell $4.84, or nearly 7%, to close at $67.18 on February 5, 2025.
On April 30, 2025, the Company released its 1Q25 financial results, reporting that—for the first time in eight quarters—the Company’s E&G test volume and revenue were flat. On this news, the price of the Company’s stock fell $50.12, or nearly 43%, to close at $66.85 on April 30, 2025.
If you have purchased GeneDx securities, and have suffered a loss, realized or unrealized, and you wish to discuss this investigation, please contact attorney Nicholas Bruno at (888) 398-9312 or at [email protected].