The pharma company TG Therapeutics was recently served with a securities class action suit stemming from allegations that it made false or misleading allegations about one of its developing cancer treatments. To learn more about this case, visit Battea’s TG Therapeutics case summary.
Specifically, the class action suit alleges that the company’s statements about its GENUINE Phase III trial – a non-chemotherapy form of cancer treatment – which it called best in class and believed would be successful overall. It was later revealed, however, that the clinical trial for GENUINE Phase III would need to be materially altered. When this news came to light in mid-October of last year, the company’s stock took a significant hit.
The suit has a class period from Sept. 15, 2014, to Oct. 12, 2016.
What happened with the trial?
In October, TG announced that the second part of the clinical trial for GENUINE, which was supposed to assess how two different drugs affected patients, would have to be eliminated, and that the total number of patients enrolled in the first part would have to be significantly reduced, from 200 people to just 120, according to a report from The Motley Fool. The hope was that this change would save the company some $10 million in costs over a two-year period, and the U.S. Food and Drug Administration had already approved the changes.
TG Therapeutics further noted that it believed it would start to make data from the study available in the first half of 2017, and that if all went to plan the drug would be submitted to the FDA for approval around the start of 2018. However, investors seemed to take this news as a sign that the drug would be more difficult for the FDA to approve because the company would not provide survival data. That is what likely resulted in the decline of TG’s stock price.
How the stock price moved
Around the start of the class period, TG Therapeutics stock was trading at $11.21 per share, and by late July of 2015, that number had climbed to $18.68. However, it began a slow but steady decline after that point, closing 2015 at $11.93. That slide continued throughout most of 2016, thanks in part to the revelations about the GENUINE trial’s difficulties. On Oct. 7, 2016, the stock was trading at a recent high of $8.64 per share, and had slipped to $8.25 just five days later, when the GENUINE announcement was made. The next day, the price stood at just $6.85, and has been falling steadily since then.
TG’s price closed last year at $4.65 per share and at one point in January it reached as low as $4.10. However, the price has improved slightly since then, as it is currently trading at $4.85.
For more information on this case or other class action litigations, please contact Sam Wankel, Senior Vice President, Research, Battea Global Litigation Research, Inc., at 203-987-4949 or firstname.lastname@example.org.