A class action lawsuit was filed against Baxter International (BAX) on October 16, 2025. The plaintiffs (shareholders) alleged that they bought BAX stock at artificially inflated prices between February 23, 2022, and July 30, 2025 (Class Period) and are now seeking compensation for their financial losses. Investors who bought Baxter stock during that period can click here to learn about joining the lawsuit.
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Baxter is a global healthcare company that develops and markets medical products for hospitals. Its key IV product, the Novum IQ Large Volume Pump (Novum LVP), controls the delivery of IV fluids, medications, blood, and nutrients. Approved in Canada in 2020 and the U.S. in 2024, it is a major driver of Baxter’s growth.
Baxter’s claims about the safety, efficacy, product rollout, customer feedback, and sales prospects of the Novum LVPs are at the heart of the current complaint.
Baxter’s Misleading Claims
According to the lawsuit, Baxter and seven of its current and/or former senior executives (the Defendants) repeatedly made false and misleading public statements throughout the Class Period. In particular, they are accused of omitting truthful information about the safety of the Novum LVP from SEC filings and related material.
In an annual report filed at the beginning of the Class Period, Baxter stated that quality management was very important. It helped the company understand and meet customer needs, prevent product defects, improve its processes and products, and ensure that its products were safe and effective.
During subsequent earnings calls, the CEO reiterated that they believed the main issue the U.S. Food and Drug Administration (FDA) raised about the Novum LVPs was resolved. Baxter had also made proactive software updates that were planned in consultation with the FDA.
Finally, during a May 1, 2025, earnings call, Baxter’s COO stated that many pumps being used in the market were over ten years old. The company planned to introduce new technology with smarter features that worked well with digital systems. He added that Baxter was seeing good progress and positive momentum with the Novum pump.
However, subsequent events (detailed below) revealed that Baxter had been informed of multiple malfunctions, injuries, and deaths caused by defects in Novum LVP. The company’s efforts to fix these problems by sending customer alerts were insufficient because the design flaws remained and continued to seriously harm patients.
Plaintiffs’ Arguments
The plaintiffs maintain that the defendants deceived investors by lying and withholding critical information about the company’s business and prospects during the Class Period. Importantly, the defendants allegedly misled investors into believing that the issues with Novum LVPs were resolved, when in fact Baxter would have to completely pause all new sales of these pumps.
The information became clear through a series of partial disclosures. The final truth emerged on July 31, 2025, when Baxter abruptly announced the suspension of all new Novum LVP sales. Baxter notified investors that it would “voluntarily and temporarily pause shipments and planned installations of the Novum LVP,” and that the company was unable to provide a specific date for when it will resume shipping and installing Novum LVPs.
The COO added that the sudden stop in sales happened because of problems found through their quality monitoring systems, customer feedback, and infusion data. Following the news, BAX stock plunged nearly 22% the same day.
To conclude, the defendants misled investors into believing that Baxter had solved the issues with the Novum LVPs only to later halt their sales as issues persisted. Due to these issues, BAX stock has lost 36.7% year-to-date.
