Stock Sales By Leaders At 'Test Nebraska' Testing Company Raise Legal Concerns

COVID-19 samples at the Test Nebraska lab at CHI St. Elizabeth in Lincoln (Photo: Lincoln Journal Star)
December 2, 2020 - 3:30pm

An NPR investigation has found two board members of the company providing COVID-19 tests to Nebraska sold nearly $1 million worth of company stock and then didn’t publicly disclose it before the legal deadline.

The state’s Test Nebraska program is a $27 million contract with several companies based in Utah. The head of the consortium said in April that none of the companies involved would make money off of the testing.

One of those companies is Co-Diagnostics, which provides the re-agents used to test samples for COVID-19. As NPR reports, two Co-Diagnostics board members sold their shares in May, soon after the share price surged with the announcement of Test Nebraska and similar partnerships in Utah and Iowa.

Gov. Pete Ricketts says he’s very pleased with the Test Nebraska program and has no concerns about Co-Diagnostics.

"This is a free service to the people of Nebraska that’s allowed us to expand testing greatly here in our state," Ricketts said. "Certainly when we the state were making the decision about bringing them on board, being a volunteer effort was not part of our calculus in this, it was about whether they were going to be able to deliver the testing to the citizens of Nebraska."

Co-Diagnostics is facing a lawsuit from investors who say the company’s claims of a 100% accurate test were blatantly fraudulent.

The company stands by its internal verification process. Both the CEO and CFO of Co-Diagnostics sold all their company shares last week, and neither currently hold direct stock in the company.

Nebraska health officials say Test Nebraska accounts for about half of all COVID-19 tests in the state so far.

Read the full story from NPR's Tom Dreisbach at npr.org.

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