According to the law firm press release, Arrowhead is a biopharmaceutical company that develops novel drugs to treat intractable diseases in the United States. Among the Company’s products under development at all relevant times was ARC-520, an RNAi-based therapeutic in Phase IIb clinical efficacy studies to treat chronic hepatitis B virus infection.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) ARC-520 was fatal at certain doses; (ii) consequently, the U.S. Food & Drug Administration (“FDA”) was unlikely to approve ARC-520 as a hepatitis B treatment; (iii) Arrowhead had overstated the approval prospects and commercial viability of ARC-520; and (iv) as a result, Arrowhead’s public statements were materially false and misleading at all relevant times.
On November 8, 2016, post-market, Arrowhead issued a press release announcing that the FDA would be placing a clinical hold on the Company’s Heparc-2004 clinical study of ARC-520, likely due to deaths at the highest dose of an ongoing non-human primate toxicology study.
On this news, Arrowhead’s share price fell $1.91, or 31.26%, to close at $4.20 on November 9, 2016.