The Financial Markets Authority (FMA) ruled in a decision released yesterday Pacific Edge failed to release information in a timely manner under ''continous disclosure obligations''.
It censured Pacific Edge with a public warning and ordered it to pay $500,000 compensation for announcements in October 2013 about signing agreements with major United States health providers to use its mainstay diagnostic Cx-bladder test.
Exchange records show Pacific Edge's share price rose from a low of 46c on October 11 to $1.40 by October 25 - a 204% increase.
The trading periods at issue for the FMA were October 11-16, and then October 18-22, the delay periods of the announcements.
FMA director of enforcement and investigations, Belinda Moffat, said Pacific Edge had failed to make timely disclosures as required so all investors could participate ''in a fully informed market''.
The compensation will go to shareholders who sold shares during the periods, when there were ''some days'' of delays, which should have ''immediately'' been disclosed on the respective signings, she said.
''Following the announcement of each agreement, the price of Pacific Edge's shares increased,'' the FMA said.
Pacific Edge had also since done a compliance audit and implemented recommendations, she said.
Pacific Edge chief executive David Darling said from Auckland yesterday he was disappointed the ''hiccup'' occurred.
Processes within the company had since been changed, he said.
Mr Darling said at the heart of the issue was the FMA deciding the ''trigger point'' to go public with information was at the moment the US companies signed the agreements, not the point where the US companies later gave approval for Pacific Edge to make announcements.
The company has about $12 million of cash, raised from investors for marketing in 2013.
When asked if the cash was adequate for payment, Mr Darling said: ''It just hurts ... it's tough for a smaller company.''
Pacific Edge is scheduled to deliver its full-year result on Thursday.
