A securities class action has been filed in the USDC — E.D.PA. against West Pharmaceutical Services, Inc. (WST) (“West” or the “Company”) on behalf of all persons and entities that purchased or otherwise acquired West common stock between February 16, 2023, and February 12, 2025, both dates inclusive (the “Class Period”).
West is a Pennsylvania corporation that is headquartered in Exton, Pennsylvania. West is a medical supplies company specializing in packaging components, containment solutions, and delivery systems for injectable drugs. West operates with two reportable segments: Proprietary Products and CM.
The Company categorizes its Proprietary Products segment into three categories: (1) HVP components; (2) HVP delivery devices; and (3) standard products. HVP components include vial seals, vial stoppers, and syringe plungers under West brands such as FluroTec, NovaPure, and Westar. HVP delivery devices are advanced drug systems that include the Company’s SmartDose devices. The Contract Manufacturing segment consists of custom drug delivery systems and device assemblies produced according to customers’ proprietary designs and specifications. As part of the Company’s CM business, West develops CGM devices for its customers. West claims that its HVP offerings generate significantly higher margins than the Company’s standard proprietary products and CM products, making the strength and profitability of the HVP portfolio critical to West’s overall financial performance.
The claim arises on February 13, 2025, when West issued extremely weak 2025 revenue and earnings forecasts.
The complaint alleges that throughout the Class Period, Defendants misled investors by failing to disclose that:
(1) despite claiming strong visibility into customer demand and attributing headwinds to temporary COVID-related product destocking, West was in fact experiencing significant and ongoing destocking across its high-margin HVP portfolio;
(2) West’s SmartDose device, which was purportedly positioned as a high-margin growth product, was highly dilutive to the Company’s profit margins due to operational inefficiencies;
(3) these margin pressures created the risk of costly restructuring activities, including the Company’s exit from continuous glucose monitoring (“CGM”) contracts with long-standing customers; and
(4) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially false and/or misleading or lacked a reasonable basis, thereby harming investors.
On this news, West’s stock dropped $123.17 per share, a decline of approximately 38%, to close at $199.11 on February 13, 2025.
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