According to the law firm press release, Cempra, Inc., a clinical-stage pharmaceutical company, focuses on developing antibiotics to meet medical needs in the treatment of bacterial infectious diseases in North America. One of the Company’s lead product candidates include solithromycin (CEM-101), which is in Phase III clinical trials for the treatment of community acquired bacterial pneumonia, as well as for uncomplicated bacterial urethritis.
The Complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) solithromycin posed significant safety risks for hepatotoxicity; and (ii) as a result of the foregoing, Cempra’ public statements were materially false and misleading at all relevant times.
On November 2, 2016, the United States Food and Drug Administration (“FDA”) posted on its website a preliminary review of solithromycin. FDA reviewers noted that "[a] significant safety signal for hepatotoxicity was observed in the solithromycin development program," and there was concern for "the high rate of infusion site-related reactions."
On this news, Cempra stock fell $11.35, or 60.86%, to close at $7.30 on November 2, 2016, the next trading day.
On November 4, 2016, Cempra issued a press release announcing that NASDAQ has halted trading of the Company’s common stock. Cempra also announced that the FDA Antimicrobial Drugs Advisory Committee would meet that day to discuss the safety and efficacy of solithromycin to treat community-acquired bacterial pneumonia.
On July 5, 2017, the Court appointed Lead Plaintiffs and Counsel. Lead Plaintiff filed an amended Complaint on August 16, 2017. On September 29, Defendants filed a Motion to Dismiss the amended Complaint. On October 26, 2018, the Court issued an Order granting Defendants' Motion to Dismiss and entered Judgment. On November 21, Lead Plaintiffs filed a Notice appealing the Orders merged into the Judgment.