Shareholders of global science and technology company Danaher claim its top brass misled them about increased revenue growth during the onset of the COVID-19 pandemic and failed to inform them that it was not sustainable as the virus entered an “endemic” state.
Following the onset of the COVID-19 pandemic, Danaher’s diagnostic tests and life sciences equipment were used in efforts to combat the virus, the complaint states, and as a result, the company experienced “explosive” revenue growth: its stock price nearly tripled, and reached an all-time high of $332.43 per share on Sept. 3, 2021.
However, by the beginning of 2022, it became clear that the virus was entering an endemic phase — meaning the number of infections was no longer growing at a high rate — and the demand for Danaher’s products began to slow down.
“Despite publicly and repeatedly declaring that there would be enduring demand for products supporting the development of treatments for COVID-19, and that the bioprocessing business’ far larger non-COVID product offerings provided a robust runway for long-term growth, Danaher’s bioprocessing business was in jeopardy of falling short of its pandemic-era success,” the complaint states.
Despite this slow-down in business, the individual defendants continued to tout optimistic business projections for Danaher, until October 2023, when the company finally revealed it had cut its full-year outlook, “increasing the core sales decline to a firm low double-digit range and inverting modest growth in the base business to a low single digit decline.”
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