Perrigo(US:PRGO) Prnewswire·2025-11-24 12:20Core Viewpoint - The Perrigo Company plc is facing a class action lawsuit due to alleged violations of the Securities Exchange Act of 1934, with claims that the company misled investors regarding its infant formula business and financial performance during the specified class period [1][4]. Company Overview - Perrigo provides over-the-counter health and wellness solutions and acquired Nestlé's Gateway infant formula plant and the rights to Nestlé's Good Start® infant formula brand for $170 million in November 2022 [3]. Allegations of the Lawsuit - The lawsuit alleges that Perrigo made false or misleading statements and failed to disclose significant issues, including: - Underinvestment in the acquired infant formula business [4]. - The need for substantial capital and operational expenditures beyond stated estimates for remediation [4]. - Significant manufacturing deficiencies in the infant formula facility [4]. - Overstated financial results, including earnings and cash flow [4]. Financial Disclosures and Impact - On February 27, 2024, Perrigo disclosed acquisition-related charges of $35 million to $45 million for remediation, along with a 50% decline in earnings per share compared to the previous year, leading to a stock price drop of over 15% [5]. - On May 7, 2024, Perrigo reported net sales of $91 million, a decrease of 34.5%, and a gross margin decline of 90 basis points, resulting in a nearly 10% drop in stock price [6]. - On August 6, 2025, Perrigo's adjusted gross profit decreased by $30 million (6.9%), with a reported gross margin of 34.4%, causing a stock price decline of more than 11% [7]. - On November 5, 2025, Perrigo announced a strategic review of its infant formula business, slashing its fiscal year 2025 outlook, which included a negative sales growth guidance of -2.5% to -3% and a significant cut in expected earnings per share, leading to a stock price drop of over 25% [8].