According to a press release dated November 10, 2006, Barrier Therapeutics, Inc. (BTRX) announced that the putative securities class action lawsuit filed against the company, certain of its officers and certain of the underwriters for the company's 2004 initial public offering and 2005 secondary offering has been voluntarily dismissed, in its entirety and with prejudice, by the lead plaintiffs' counsel. The lead plaintiffs' counsel submitted the stipulation of dismissal to the United States District Court for the District of New Jersey, without any payment by the company or any of the defendants to the plaintiffs or their counsel. The company expects the court to enter an order with respect to the submission promptly.
The complaint charges Barrier and certain of its officers and directors with violations of the Securities Act of 1933 and Securities Exchange Act of 1934. Barrier is a biopharmaceutical company, engaged in the discovery, development, and commercialization of pharmaceutical products in the field of dermatology. The complaint alleges that Barrier made a series of materially false and misleading statements concerning the Company’s business and products under development. In particular, the Complaint alleges that these statements were materially false and misleading because they failed to disclose and misrepresented the following adverse facts: (i) that the Company had failed to perform its clinical trials in conformity with FDA guidelines as they had failed to disclose that they had secretly substituted the petroleum base within Zimycan, the effect of which was to substantially lessen the likelihood that the drug could achieve FDA approval; (ii) that Hyphanox did not have a better safety or efficacy profile than fluconazole/Diflucan and, in fact, as investors ultimately learned, Hyphanox was significantly less effective than fluconazole/Diflucan; and (iii) as a result of the foregoing, defendants lacked any reasonable basis for their positive statements about Barrier.
The complaint further alleges that on or around June 29, 2005, Barrier shocked the market when it announced, among other adverse facts, that the Company’s drug trials failed to demonstrate that Hyphanox worked as well as fluconazole. In response to this announcement, the price of Barrier stock plummeted over $6.75 per share - - a decline of over 45% - - to below $8.00 per share on extremely heavy trading volume.
The lawsuit has been filed on behalf of all persons who purchased the common stock of Barrier Therapeutics, Inc. between April 29, 2004, and June 29, 2005, inclusive. Also included are those who purchased Barrier pursuant and/or traceable to the Company's Initial Public Offering ("IPO") on or about April 29, 2004 and/or in its Secondary Offering on or about February 9, 2005.