Novelos Therapeutics, Inc.
Class Period: Dec 14, 2009 to Feb 24, 2010
Lead Plaintiff Deadline: May 4, 2010 + Deadline passed
Summary of Case:
A securities class action has been filed against Novelos Therapeutics, Inc. (NVLT) ("Novelos" or the "Company") on behalf of all securities purchasers from December 14, 2009 through February 24, 2010, inclusive ("Class Period"), in the United States District Court of Massachusetts.
The complaint alleges that Novelos and Harry S. Palmin ("Palmin"), the President, Chief Executive Officer and director of the Company, are charged with violations of the Exchange Act. Novelos is a biopharmaceutical company commercializing oxidized glutathione-based compounds for the treatment of cancer and hepatitis. During the Class Period, defendant Palmin made positive statements regarding the pivotal Phase 3 clinical trial of the Company's primary new drug candidate, NOV-002, which was being evaluated as a treatment for advanced non-small cell lung cancer when used in combination with first-line chemotherapy. Defendant Palmin stated, among other things, that the NOV-002 Phase 3 trial had lasted longer than anticipated because patients in the trial were living longer than the Company expected. The complaint further alleges that these statements were materially false and misleading because defendant Palmin knew, or recklessly disregarded, that the unexpected length of the trial could be, and was, in fact, caused by the survival times of the patients in the control arm of the study who did not receive NOV-002.
On February 24, 2010, the Company announced that NOV-002 did not meet its primary endpoint of improvement in overall survival in the Phase 3 trial. Indeed, it was disclosed that the trial's duration was longer than originally anticipated not because of NOV-002's efficacy, but because the patients in the control arm of the trial -- who did not receive NOV-002 -- lived longer than expected. On this news, shares of the Company's stock declined more than 80%, from a close of $1.65 per share on February 23, 2010, prior to announcement of the results of the NOV-002 Phase 3 trial, to a close of $0.32 per share on February 24, 2010, after announcement of the Phase 3 trial results, on unusually heavy trading volume.
If you purchased this company's shares during the Class Period and suffered a loss or for further information about the case, please review the links below.