According to the law firm press release, Orexigen is a biopharmaceutical company focused on the development of pharmaceutical product candidates for the treatment of obesity, including Contrave, which it claims “regulates appetite and energy expenditure through [central nervous system] activity.”
The complaint alleges that as part of the FDA post-marketing approval process for Contrave, Orexigen was required to conduct “a new randomized, double-blind, placebo-controlled study to evaluate the effects of long-term treatment with Contrave on the incidence of [major adverse cardiac events, or ‘MACE’] in overweight and obese subjects with [cardiovascular] disease or multiple [cardiovascular] risk factors,” referred to as the “LIGHT study.” On March 3, 2015, in connection with reporting to investors the status of certain patent applications the Company had sought for Contrave, Orexigen disclosed detailed interim results of its ongoing LIGHT study, despite, the complaint alleges, having been previously admonished by the FDA for inappropriately releasing interim study data in the past. As a result of the Company’s March 3, 2015 disclosure of the interim study results, the complaint alleges that the price of Orexigen common stock significantly increased in intraday trading on March 3, 2015, on highly unusual trading volume.
Then, after the close of trading on March 5, 2015, Forbes published a report entitled “Top FDA Official Says Orexigen Study Result ‘Unreliable,’ ‘Misleading.’” The complaint alleges that this report contained commentary from an FDA official charged with overseeing the Contrave post-marketing clinical trial program who stated in pertinent part that the interim data from the study was probably “‘unreliable,’” “‘misleading,’” and “‘likely false,’” with the Forbes report warning that “[i]f Orexigen cannot find a way to set things right, it could face fines, civil penalties, or even the withdrawal of Contrave from the market.” On this news, the complaint alleges that the price of Orexigen stock fell substantially when trading resumed on March 6, 2015.
On August 20, 2015, a consolidated complaint was filed.
On May 19, 2016, the Court issued an Order granting Defendants' Motion to Dismiss. Plaintiffs were given leave to file an amended complaint. Plaintiffs did not amend their complaint, thus the Court entered judgment and closed this case on June 27. Lead Plaintiff filed a notice appealing the District Court's decision on July 26. On January 7, 2019, the Court of Appeals issued a Mandate affirming in part and reversing in part the District Court's Dismissal.