Titan Pharmaceuticals, Inc. Conclusion: On December 23, 2003, the Plaintiff filed a Notice of Voluntary Dismissal.
According to a press release dated November 4, 2003, the complaint alleges that defendants Titan Pharmaceuticals and certain of its officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b- 5 promulgated thereunder, by issuing a series of material misrepresentations to the market between December 1, 1999 through July 22, 2002 concerning Titan's drug, Iloperidone.
More specifically, the Complaint alleges that the defendants' statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (1) that Titan was aware, through its licensing agreement with Aventis SA, that Iloperidone caused negative cardiovascular, urogenital, and respiratory reactions; (2) that Titan was aware that Iloperidone was not safe and efficient; (3) that Titan was aware that the Iloperidone program conducted by Novartis SA was not proceeding well and would not be completed on schedule; (4) that Titan was aware that Iloperidone was not a comparable or superior product to its competitors; (5) that Titan was aware, at the time it entered into the licensing agreement with Novartis SA for the Japanese marketing rights, that Iloperidone caused negative cardiovascular, urogenital, and respiratory reactions; (6) that Titan was aware that the clinical trial results indicated that the U.S. Food and Drug Administration would require Iloperidone, because of its cardiovascular, urogenital, and respiratory problems, to be marketed with box warnings and physician letters; and (7) that Titan was aware that it was not making progress towards commercialization of Iloperidone because the drug caused cardiovascular, urogenital, and respiratory problems.
The complaint further alleges that on July 24, 2001, the Company announced that its U.S. filing for Iloperidone would be delayed a year. The Company indicated that the delay was necessary to investigate once-a-day dosing, demonstrate a favorable safety profile when switching from other antipsychotic agents to Iloperidone, and support the competitive profile of the compound. This announcement failed to reveal the real reason behind the Company's delay in its U.S. filing, which was that Iloperidone caused cardiovascular, urogenital, and respiratory problems. The market reacted swiftly to this news, with the Company's stock falling 57%, or $16.04 to close at $11.95 on July 24, 2001. Then, one year later on July 22, 2002, after the market had closed, the Company announced the completion of a study conducted by Novartis of the effect of Iloperidone on the EKG profile of patients. A primary endpoint of the study was evaluation of the change in QT interval from baseline to week six. The study indicated that results for iloperidone were roughly comparable to that for ziprasidone, one of the approved agents in the study. Given these results, the Company stated that, even if approvable, these results may potentially limit the opportunity of Iloperidone as first line therapy for schizophrenia. The market reacted swiftly to this news, with the Company's stock falling 97%, or $63.63 from a high during the Class Period of $65.26 on September 26, 2000 to close at $1.63 on July 22, 2002.
SIC Code: 2836
Industry: Biotechnology & Drugs
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