The original complaint charges Savient and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Savient is a specialty biopharmaceutical company focused on developing and marketing pharmaceutical products that target unmet medical needs. The Company is developing Puricase, also referred to as pegloticase, for the control of uric acid in patients with gout, whose signs and symptoms are inadequately controlled by conventional urate lowering therapy due to ineffectiveness, dose limiting toxicity, hypersensitivity or other contraindications.
The complaint alleges that during the Class Period, defendants made false and misleading statements about two clinical trials of pegloticase called GOUT 1 and GOUT 2. Specifically, defendants failed to disclose five serious adverse events (SAEs) experienced by patients in those studies. Subsequently, on October 27, 2008, before the markets opened, the Company issued a press release that disclosed, among other things, the previously undisclosed SAEs. As a result of this disclosure, Savient’s stock price declined significantly.
Plaintiff seeks to recover damages on behalf of all purchasers of Savient securities during the Class Period (the Class). The plaintiff is represented by Coughlin Stoia, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
On March 12, 2009, the Court issued the Order appointing Lawrence J. Koncelik, Jr. as lead plaintiff and approved lead plaintiff’s selection of Pomerantz Haudek Block Grossman & Gross LLP as lead counsel. On April 29, 2009, the lead plaintiff filed an Amended Complaint. On June 29, 2009, the defendants filed a motion to dismiss.
According to a press release dated September 30, 2010, Savient Pharmaceuticals, Inc. (Nasdaq: SVNT) announced that the United States District Court for the Southern District of New York has dismissed the Class Action originally filed on November 25, 2008, and captioned Richard Sagall vs. Savient Pharmaceuticals, Inc., et al. , against the Company and two of its former officers. The suit alleged that the Company made false and misleading statements relating to the GOUT1 and GOUT2 phase 3 clinical trials and that the Company failed to disclose in a timely manner serious adverse events which occurred in five patients in these trials. The Company and the other named defendants had filed a motion to dismiss the complaint in June 2009.
The Court's decision dismissing the Class Action is based on the plaintiff's failure to set forth particularized facts, through direct or circumstantial evidence, which give rise to a strong inference that the defendants acted with intent to defraud, recklessness or a conscious disregard of the truth. The Court also concluded that the plaintiff had not demonstrated that there was any evidence that the defendants engaged in conscious misbehavior or recklessness in the manner it disclosed the relevant clinical trials data, and that the plaintiff failed to show that the defendants had made false and misleading statements or material omissions in its statements to the detriment of the investing public. The Court's ruling, while dismissing all claims, does not preclude the plaintiff from seeking to file an amended complaint, and is also subject to appeal.
On October 28, 2010, the lead plaintiff filed a Notice of Appeal as to Clerk's Judgment. The appeal is pending in the Second Circuit Court of Appeal.