GeneDx Faces Shareholder Lawsuit After Fabric Genomics Valuation Collapse

Hagens Berman, a firm specializing in securities litigation, is currently investigating claims that GeneDx executives overstated the benefits of the Fabric Genomics purchase. The litigation centers on the period between April 16, 2025, and May 4, 2026, targeting the company's failure to disclose the true state of the acquisition. When the firm reported its Q1 2026 results, it revealed a tenfold increase in net losses and a significant revenue miss, effectively erasing nearly all the cash value of the business unit acquired just one year prior.

The fallout from these disclosures forced a 12% cut to the company's 2026 revenue guidance. Beyond the financial shortfall, the company pointed to an adverse shift in product mix, with genome revenue failing to meet the performance of its exome business. This pivot prompted a sharp reduction in growth projections, which had been touted as "at least 20%" as recently as February.

Reed Kathrein, the Hagens Berman partner leading the investigation, stated that the firm is examining whether leadership possessed internal knowledge of the disconnect between their public projections and the reality of the company's acquisitions. Amidst this turmoil, GeneDx appointed Mark Gardner as its new president. The firm is now soliciting information from investors and potential whistleblowers, setting a lead plaintiff deadline of August 3, 2026.