LOS ANGELES, June 17, 2020 (GLOBE NEWSWIRE) -- The Portnoy Law Firm advises Chembio Diagnostic System, Inc. (NASDAQ: CEMI) investors that the firm has initiated an investigation into possible securities fraud, and may file a class action on behalf of investors.
Investors are encouraged to contact attorney Lesley F. Portnoy, by phone 310-692-8883 or email: lesley@portnoylaw.com, to discuss their legal rights, or click here to join the case via www.portnoylaw.com. The Portnoy Law Firm can provide a complimentary case evaluation and discuss investors’ options for pursuing claims to recover their losses.
The Portnoy Law Firm investigation focuses on whether the Company misled investors regarding its FDA authorization for the Chembio Diagnostic System DPP COVID-19 IgM/IgG System, a SARS-CoV-2 antibody test (the “DPP Test”). On June 16, 2020, the U.S. Food and Drug Administration revoked the emergency use authorization of the DPP Test due to performance concerns with the accuracy of the test. The FDA further stated that:
The Chembio antibody test was one of the first antibody tests authorized by the FDA during the COVID-19 public health emergency. At the time of authorization, based on the information that Chembio submitted to the FDA at that time, the agency concluded that the test met the statute’s “may be effective” standard for emergency use authorization, and that the test’s known and potential benefits outweighed its known and potential risks.
As the FDA has learned more regarding the capability for performance of SARS-CoV-2 serology tests during the pandemic, and what performance is necessary for users to make well-informed decisions—through both the continued review and authorization of serology tests as well as through a research partnership with the National Institutes of Health’s National Cancer Institute (NCI)— the FDA was able to develop general performance expectations for these tests, which are listed in our serology templates.
Data submitted by Chembio as well as an independent evaluation of the Chembio test at NCI showed that this test generates a higher than expected rate of false results and higher than that reflected in the authorized labeling for the device. Under the current circumstances of the public health emergency, it is not reasonable to believe that the test may be effective in detecting antibodies against SARS-CoV-2 or that the known and potential benefits of the test outweigh the known and potential risks of the test, including the high rate of false results.
On this news, Chembio’s stock fell over 60% in intraday trading on June 17, 2020.
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The Portnoy Law Firm represents investors in pursuing claims against caused by corporate wrongdoing. The Firm’s founding partner has recovered over $5.5 billion for aggrieved investors. Attorney advertising. Prior results do not guarantee similar outcomes.
Lesley F. Portnoy, Esq.
Admitted CA and NY Bar
lesley@portnoylaw.com
310-692-8883
www.portnoylaw.com
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