A recently-published report from Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse analyzes securities class action litigation in 2020 and demonstrates both a continued focus by the plaintiffs’ bar on life science firms (including those in the pharmaceutical and biotechnology spaces), as well as specific trends in securities litigation affecting companies in
Adam is partner in Ropes & Gray’s Litigation and Enforcement practice, based in New York. Adam focuses on complex business litigation, including securities class action defense, breach of contract cases, deal-related litigation, breach of fiduciary duty claims, corporate governance disputes, and civil fraud and RICO claims.
A recently-published report from NERA Economic Consulting provides a look back at securities class action litigation in 2020 and demonstrates the continued focus by the plaintiffs’ bar on life science firms, particularly those centered on the development and commercialization of drugs and devices.
The report found that excluding merger objections, the Health Technology and Services…
George Lehmann, Insured Benefit Plans, Inc. v. Ohr Pharmaceutical, Inc., 2020 WL 5988517 (2nd Cir. Oct. 9, 2020)
On October 9, 2020, the Second Circuit affirmed the dismissal of an action brought against Ohr Pharmaceutical, Inc. and certain of its executives. Plaintiffs alleged that the defendants made misleading statements concerning the efficacy of Ohr’s core product, a Squalamine-based treatment for wet age-related macular degeneration (WetAMD), a condition that can cause vision loss.
The complaint pleaded that in January 2018, Ohr announced the results of a phase III clinical trial of its WetAMD treatment, that the results of this trial showed that the treatment arm actually performed worse than the control arm, and that the Company’s stock price fell by over 80% as a result.
Hou Liu v. Intercept Pharmaceuticals, Inc., 2020 WL 5441345 (S.D.N.Y. Sept. 9, 2020)
On September 9, 2020, Judge Lewis A. Kaplan of the Southern District of New York denied a motion to amend judgment and a request for leave to file a second amended complaint following the Court’s dismissal of an action against Intercept Pharmaceuticals, Inc. and certain of its executives. The Court ruled that plaintiffs failed to identify any facts the Court overlooked in dismissing the action on March 26, 2020, and had not offered any newly-discovered evidence justifying leave to amend the complaint.
A recently-published report from NERA Economic Consulting provides a mid-year look back at securities class actions and demonstrates the continued focus by the plaintiffs’ securities litigation bar on health care and life science firms, particularly those focused on the development and commercialization of drugs and devices.
The report found that approximately half of all COVID-19-related…
Shanawaz v. Intellipharmaceutics Int’l Inc., No. 17-CV-5761 (JPO) (S.D.N.Y. July 30, 2020)
On July 30, 2020, Judge J. Paul Oetken of the Southern District of New York preliminarily approved a settlement in a putative shareholder class action concerning development of an OxyContin alternative, Rexista. The parties agreed to a settlement amount of $1.6 million.…
Skiadas v. Acer Therapeutics Inc., 2020 WL 3268495 (S.D.N.Y. June 16, 2020)
On June 16, 2020, Judge Gregory Woods of the Southern District of New York granted in part and denied in part a motion to dismiss an action against Acer Therapeutics Inc. and certain of its executives regarding disclosures made in offering documents prior to the Company’s submission of a New Drug Application (“NDA”) for EDSIVO, a drug that treats Vascular Ehlers-Danlos Syndrome (“vEDS”). Plaintiff allege that when the FDA declined to approve the drug, Acer’s stock dropped.
Smith v. Antares Pharma, Inc., 2020 WL 2041752 (D.N.J. Apr. 28, 2020)
Judge Michael A. Shipp of the District of New Jersey dismissed a putative class action complaint filed against Antares Pharma, Inc., and certain of its officers, holding that the plaintiff failed to adequately allege an actionable misrepresentation or omission concerning certain adverse events observed in two Phase 3 clinical studies of Antares’s lead product, QuickShot Testosterone (“QST”), an auto injector product for testosterone replacement therapy. Plaintiff alleged that Antares made eight materially false or misleading statements concerning the safety of the product and likelihood of FDA approval.
Mehta v. Ocular Therapeutix, Inc., 955 F.3d 194 (1st Cir. 2020)
On April 9, 2020, the First Circuit affirmed the dismissal of an action brought against a biopharmaceutical company, Ocular Therapeutix, Inc., and certain of its officers, regarding statements concerning the Company’s manufacturing processes. The Court held that plaintiffs failed to allege facts giving rise to a strong inference of scienter (i.e., fraudulent intent) and thus failed to adequately plead a securities law violation.
Hou Liu v. Intercept Pharm., Inc., 2020 WL 1489831 (S.D.N.Y. Mar. 26, 2020)
On March 26, 2020, Judge Lewis A. Kaplan of the Southern District of New York granted a motion to dismiss an action against Intercept Pharmaceuticals, Inc. and certain of its executives regarding twenty-one statements made about safety, dosing, and effects of Ocaliva, a drug approved to treat patients with primary biliary cholangitis (“PBC”), a rare liver disease. The complaint alleged that Intercept’s stock dropped after it issued a Dear Healthcare Provider Letter (the “HCP Letter”) and again after the FDA issued a drug safety communication and a corresponding safety alert on Ocaliva.