According to the press release dated September 10, 2010, the complaint alleges that, during the Class Period, Acura and certain of its officers and directors concealed material adverse facts about the Company's lead product candidate, Acurox, an orally administered immediate release tablet containing oxycodone as its active ingredient and niacin as an oral abuse-deterrent. After repeated glowing announcements by Acura to its investors touting the strength of the clinical trials of Acurox and the drug's potential for obtaining FDA approval, and thus commercial viability, the market was stunned when, on April 20, 2010, the FDA posted, on its website, briefing materials for the April 22, 2010 meeting to consider the New Drug Application of Acurox advising that: Acura's Aversion Technology was nowhere near effective enough to warrant approval, that the Company's clinical data was defective, that its clinical studies were not properly designed, that the Company had wholly ignored specific directives from FDA over the past four years as to specific clinical trials and evidence Acura had to demonstrate, and that that no evidence had ever been presented to the FDA that the niacin additive discouraged abusers from abusing oxycodone.
On this news, Acura's stock price declined 42.5% in one day, to close at $6.25 in afterhours trading. On April 22, 2010, the FDA Joint Panel voted 19-1 against approving Acurox. On the same day, it was reported that the FDA had been prodding Acura to demonstrate the deterrent efficacy of niacin since at least May 2009. As a result of these disclosures, Acura's stock price declined 39%, to $3.20 per share, in the pre-market trading on April 23, 2010.
On January 11, 2011, the Honorable Virginia M. Kendall signed the Memorandum Opinion and Order appointing the Acura Shareholder Investors Group as lead plaintiff and approved its selection of Kahn Swick & Foti, LLC as lead counsel. The lead plaintiff filed an Amended Complaint on March 14, 2011, amending the individual defendants named in the action. The defendants responded by filing a motion to dismiss on May 13, 2011.
On October 31, 2011, the plaintiffs filed a Motion for Preliminary Approval of Class Action Settlement and Notice to the Settlement Class. The Settlement provides for a benefit to the Class in the amount of One Million Five Hundred Thousand Dollars ($1,500,000) in cash. The settlement was preliminarily approved on November 10, 2011. The Settlement Fairness Hearing is set for February 16, 2012.
On March 14, 2012, this Action was dismissed in its entirety with prejudice as to all Defendants, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure.