A securities class action suit was filed against a ventricular assist device developer and manufacturer following claims that the company and some of its senior executives made false disclosures about certain regulatory and manufacturing failures.
The lawsuit against HeartWare International Inc. was filed in the U.S. District Court for the Southern District of New York on behalf of investors who purchased shares in the company during the class period between June 10, 2014 through Jan. 11, 2016, according to a press release. HeartWare develops and manufacturers small implantable heart pumps. The company website states that its product has been used successfully in 10,000 pump implants.
Lawsuit claims defendants made false claims about addressing previous failures
The class action filing alleges that during the class period the defendants made false claims concerning manufacturing and regulatory failures. These issues were identified in a letter from the Food and Drug Administration written to warn the company. HeartWare informed investors that it addressed the problems named in the FDA letter, and that the failures no longer presented any risk during clinical trials. The company also informed investors that the heart pump it tested, the MVAD Pump, was no longer in danger of of missing any deadlines.
“HeartWare disclosed its decision to cease enrollment in MVAD Pump clinical trial.”
HeartWare stock drops following series of trial setbacks
On Sept. 1, 2015, HeartWare disclosed the acquisition of another medical device manufacturer, Valtech Cardio Ltd. The announcement also explained that the company was experiencing significant issues that would ultimately delay the approval of the MVAD Pump. On this news, HeartWare securities dropped $16.99 per share, or 20.77 percent, to close at $64.82 on Sept. 2, 2015.
On Sept. 9, HeartWare disclosed its decision to cease enrollment in the MVAD Pump clinical trial. The cited reason was a manufacturing problem with the device. The following month, on Oct. 12, HeartWare disclosed that a number of patients in the MVAD Pump clinical trial suffered adverse health effects. As a result, the company announced that the trial would be delayed again. Following this news, the disclosure stock in the company dropped close to 30 percent, from $50.07 on Oct. 9 to close at $35.21 on Oct. 13.
On Jan. 11, 2016, the company made another announcement concerning the MVAD Pump clinical trial. HeartWare disclosed that nearly half of pump recipients involved in the trial suffered significant problems. The medical device manufacturer announced that the trial would be suspended until further notice. Following news of yet another setback, stock in the company fell once more by over 35 percent, from $40.84 on Jan. 11 to close at $26.50 per share on Jan. 12.
For more information on this case or other class action litigations, please contact Adam Foulke at 203-987-4949 or firstname.lastname@example.org.