Kirby McInerney LLP Announces the Filing of a Securities Class Action on Behalf of Syneos Health, Inc. (SYNH) Investors

By: Kirby McInerney LLP via Business Wire

July 28, 2023 at 18:12 PM EDT

The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Southern District of New York on behalf of those who acquired Syneos Health, Inc. (“Syneos” or the “Company”) (NASDAQ: SYNH) securities during the period from September 9, 2020 through November 3, 2022 (the “Class Period”). Investors have until September 25, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.

Syneos operates as a biopharmaceutical solutions organization, offering therapeutic expertise, bioanalytics solutions, clinical development services, medical devices, diagnostics, and commercialization.

On February 17, 2022, Syneos filed with the SEC a release on Form 8-K disclosing the Company’s financial results for the fourth quarter and full year results for 2021 (the “4Q21 Release”). The lawsuit alleges that, in direct contradiction to the Company’s prior claim that reimbursable expenses would recover and accelerate in 2022, the 4Q21 Release revealed that the revenue category would likely never recover to pre-pandemic levels. As a result, Syneos segregated reimbursable expenses from many of its operational metrics, revealing that $3.8 billion of the Company’s Clinical Solutions backlog (36%) was at risk of never being collected and providing an alarmingly low book-to-bill ratio of just 0.34x in the segment when reimbursable expenses were included. On this news, the price of Syneos shares declined by $4.01 per share, or approximately 4.81%, from $83.37 per share to close at $79.36 on February 17, 2022.

On August 2, 2022, Syneos filed with the SEC a release on Form 8-K announcing its financial results for the quarter ended June 30, 2022 (the “2Q22 Release”). The 2Q22 Release revealed substantial deterioration in the Company’s business, disclosing that net new business awards within Syneos’s Clinical Solutions segment had declined by roughly 34% including reimbursable expenses and 15% excluding reimbursable expenses, reflecting book-to-bill ratios of 0.94x and 1.29x, respectively. In addition, the 2Q22 Release revealed that Syneos would not achieve even its lowered expectations for reimbursable revenues for the year, causing the Company to slash expected 2022 revenues by $185 million at the midpoint. On this news, the price of Syneos shares declined by $13.96 per share, or approximately 17.64%, from $79.14 per share to close at $65.20 on August 2, 2022.

On September 13, 2022, Syneos filed with the SEC a current report on Form 8- K revealing that the Company expected to announce a book-to-bill ratio in its Clinical Solutions segment for the trailing 12 months ending September 30, 2022 in the range of 1.05x to 1.15x, excluding reimbursable expenses. During an industry conference held later that day, Michelle Keefe, Syneos’ CEO attributed the lower-than expected book-to-bill ratios to macroeconomic factors and to Syneos’s above-average exposure to SMID clients who were delaying contract awards. On this news, the price of Syneos shares declined by $8.65 per share, or approximately 13.65%, from $63.37 per share to close at $54.72 on September 13, 2022.

On November 4, 2022, Syneos issued a release disclosing the Company’s financial results for the third quarter of 2022. Syneos revealed that its book-to-bill ratios had plummeted below even the reduced figures provided in September 2022. On this news, the price of Syneos shares declined by $22.11 per share, or approximately 46.25%, from $47.81 per share to close at $25.70 on November 4, 2022.

The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) Syneos’ business development capabilities had been materially impaired by workforce reductions and leadership and operational changes, as well as labor force turmoil caused by the COVID-19 pandemic; (ii) Syneos had struggled to integrate recent acquisitions, causing Syneos to suffer from a bloated and confused organizational structure and impairing Syneos’ ability to provide comprehensive or effective customer engagement across its product portfolio; (iii) Syneos was suffering from acute competitive disadvantages as clinical trials moved to remote monitoring and decentralized administration, as Syneos lacked the tools possessed by some of its rivals to successfully run remote and decentralized trials, such as certain data visualization and statistical modeling capabilities, and Syneos had failed to adapt to changing business demands in the wake of the COVID-19 pandemic; (iv) Syneos’ backlog, book-to-bill ratios, and net new business awards had been artificially inflated by more than $500 million through the inclusion of reimbursable expenses that Syneos would never collect; (v) as a result of the above, Syneos was struggling to execute on its existing contracts and to agilely respond to its client needs, causing Syneos to suffer client dissatisfaction across its client base; and (vi) consequently, Syneos was exposed to a material undisclosed risk that Syneos would lose customers, be unable to grow its client base or win significant contract renewals, and cede market share to its rivals.

If you purchased or otherwise acquired Syneos securities, have information, or would like to learn more about this lawsuit and how it might affect your rights, please contact Thomas W. Elrod of Kirby McInerney LLP by email at investigations@kmllp.com, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.

Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: http://www.kmllp.com.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230728999647/en/

Contacts

Kirby McInerney LLP

Thomas W. Elrod, Esq.

212-699-1180

https://www.kmllp.com

investigations@kmllp.com

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Kirby McInerney LLP Announces the Filing of a Securities Class Action on Behalf of Syneos Health, Inc. (SYNH) Investors

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