Forman v. Meridian Bioscience, 2019 WL 2177030 (S.D. Ohio May 20, 2019)

On May 20, 2019, Judge Susan J. Dlott of the Southern District of Ohio granted plaintiff’s motion to reconsider and amend a prior order dismissing an action against Meridian Bioscience, Inc. and two of its executives.

Plaintiff brought claims under Section 10(b) of the Exchange Act and SEC Rule 10b-5, alleging that defendants had misrepresented the efficacy of, and concealed known regulatory problems with, blood lead level testing products manufactured by Meridian’s subsidiary, Magellan Diagnostics.

Continue Reading District Judge Finds Error in Previous Dismissal of Action Against Acquirer of Blood Testing Manufacturer

In re: Ocular Therapeutix, Inc. Sec. Litig. 2019 WL 1950399 (D. Mass. Apr. 30, 2019)

Judge George O’Toole of the U.S. District Court for the District of Massachusetts dismissed a putative securities class action complaint filed against a biopharmaceutical company, Ocular Therapeutix, Inc., and certain of its officers, holding that plaintiffs failed to adequately allege an actionable misstatement or omission concerning manufacturing issues related to an eye pain reliever drug.

Continue Reading D. Mass Holds Plaintiffs Failed to Plead Securities Law Violation Regarding Company’s Statements Concerning Manufacturing of Eye Drug

Nguyen v. New Link Genetics Corp., 2019 WL 591556 (S.D.N.Y. Feb. 13, 2019)

On February 13, 2019, Judge William H. Pauley, III of the Southern District of New York dismissed a proposed investor class action against New Link Genetics Corporation.

Plaintiffs’ allegations arose out of a disclosure by New Link that a Phase 3 trial of its drug candidate for patients with resected pancreatic cancer did not achieve its primary endpoint, which plaintiffs alleged triggered a 30% drop in its stock value.

Continue Reading S.D.N.Y. Dismisses Investor Suit Concerning Pancreatic Cancer Drug Study

The recent annual report from NERA Economic Consulting 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, excluding merger objections, the Health Technology and Services sector accounted for 25% of all filings.  While this represented a slight drop in filings against the health care sector in general compared to 2016 and 2017, there was no such drop for firms in the “Drugs” industry (using the Standard Industrial Classification to identify such firms).  In the Drugs industry, 5% of firms were targeted with securities class actions, “mostly related to misleading announcements regarding future performance.”  Indeed, the NERA Report found that, as in recent years, across securities litigation cases in general, “most allegations related to misleading firm performance in 2018 were against firms in the health care sector” and, of those cases, firms in the Drugs industry accounted for two-thirds of such cases.

Despite the continued trend represented by such cases, the NERA Report found that filings targeting foreign companies saw a stark decrease in 2018 compared to 2017, especially in the Health Technology and Services sector.  Whether that trend continues remains to be seen—but the NERA report makes clear that firms in the health care sector in general—and firms focused on the development and commercialization of new drug therapies in particular—will likely continue to face disproportionate rates of securities litigation filings.


In re Novan, Inc., 2018 WL 6732990 (M.D.N.C. Nov. 30, 2018), adopted by, No. 1:17CV999 (M.D.N.C. Jan. 28, 2019).

On January 28th, 2019, United States District Judge Catherine C. Eagles of the Middle District of North Carolina adopted a recommendation from a magistrate judge granting the defendants’ motion to dismiss a putative securities class action brought against pharmaceutical company Novan, Inc. and its officers, directors, and underwriters.

The plaintiffs alleged that defendants made false statements and omissions about the Company’s leading drug candidate in connection with an initial public offering of its stock and in the weeks subsequent to the offering.

Continue Reading District Judge Dismisses Securities Class Action Against Novan, Inc. Relating To Disclosure of FDA Recommendations About Clinical Trials

Shanawaz v. Intellipharmaceutics Int’l Inc., No. 17-CV-5761 (JPO), 2018 WL 6605426 (S.D.N.Y. Dec. 17, 2018)

On December 17, 2018, Judge J. Paul Oetken of the Southern District of New York partially denied defendants’ motion to dismiss a putative shareholder class action concerning development of an OxyContin alternative, but dismissed claims based on defendants’ non-actionable opinions.

The case, Shanawaz v. Intellipharmaceutics Int’l Inc., arose out of the disclosure by Intellipharmaceutics International Inc. that an FDA committee had found that the Company had not demonstrated that its drug candidate, Rexista, had properties that could be expected to deter abuse, and that there was not sufficient data to support inclusion of language regarding abuse-deterrent properties on the product label for the drug.

Continue Reading S.D.N.Y. Partially Dismisses Shareholder Class Action Claims Based on Pharmaceutical Company’s Nonactionable Statements of Opinion

Dougherty v. Esperion Therapeutics, Inc., 905 F.3d 971 (6th Cir. 2018)

A recent Sixth Circuit opinion demonstrates the critical importance of accurately describing interactions with the FDA when making statements on that topic.

In Dougherty v. Esperion Therapeutics, Inc., the Sixth Circuit held that plaintiffs adequately pleaded the scienter element (i.e., fraudulent intent) of their securities fraud claims against Esperion, a clinical stage pharmaceutical corporation, and its CEO, and reversed the district court’s order granting a motion to dismiss.

Continue Reading Unanimous Sixth Circuit Reverses Dismissal, Finding Plaintiffs Plausibly Alleged Defendants Knew Statements Summarizing FDA Meeting Were False