Shareholder Class Action Filed Against Rigel Pharmaceuticals, Inc. by the Law Firm of Barroway Topaz Kessler Meltzer & Check, LL
RADNOR, Pa., Feb. 20 /PRNewswire/ -- The following statement was issued today by the law firm of Barroway Topaz Kessler Meltzer & Check, LLP:
Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Northern District of California on behalf of purchasers of securities of Rigel Pharmaceuticals, Inc. (Nasdaq: RIGL) ("Rigel" or the "Company") between December 13, 2007 and October 27, 2008 inclusive (the "Class Period").
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Barroway Topaz Kessler Meltzer & Check, LLP (Darren J. Check, Esq. or David M. Promisloff, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at [email protected].
The Complaint charges Rigel and certain of its officers and directors with violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. Rigel is a clinical-stage drug development company that discovers and develops small molecule drugs for the treatment of inflammatory/autoimmune diseases, cancer and viral diseases. Rigel had been in the process of developing a drug compound known as R788 (the "Study") for the treatment of Rheumatoid Arthritis.
More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the R788 Study demonstrated an increase in certain patients' blood pressure, a potential indicator of an increase in cardiovascular risk, which had the potential to cause pharmaceutical companies to reconsider licensing the drug; (2) that patients in the Study taking R788 experienced increased liver enzymes compared to those patients taking the placebo; (3) that patients in Mexico had higher response rates in both the placebo and treated arms than U.S. patients, which may have disproportionately contributed to the overall reported benefit observed at the higher doses; (4) that the Company lacked adequate internal controls; (5) that, as a result of the foregoing, the Company's statements about its financial well-being and future business prospects were lacking in any reasonable basis when made; and (6) that the Company's Registration Statement was false and misleading at all relevant times.
On December 13, 2007, the Company issued a press release which publicized positive results of a clinical trial of R788. The December 13, 2007 press release was also appended to the Company's Form 8-K filed with the United States Securities and Exchange Commission filed that same day. In response to the positive news of the results of the Study, the price of Rigel's stock increased $17.95 per share to close at $25.95 per share on December 13, 2007, a 224% increase from the previous day's closing price of $8.00 per share.
Subsequently, on or about January 31, 2008, the Company completed its Secondary Public Offering ("SPO"). In connection with its SPO, the Company filed a Registration Statement and Prospectus (collectively referred to as the "Registration Statement") with the SEC. The Registration Statement incorporated by reference the Company's December 13, 2007 press release detailing the results of the Study. The SPO was a financial success for the Company, as it sold more than 5 million shares of stock to investors at a price of $27 per share, for gross proceeds of $135 million.
Thereafter, defendants continued to tout the positive results of the Phase II clinical trial of R788. However, on October 27, 2008 the Company shocked investors when it presented the full results of the Study at a meeting of the American College of Rheumatology ("ACR") and on an investor conference call. Those results contained adverse information that had been omitted form the Company's December 13, 2007 press release and Form 8-K, as well as from the Registration Statement and the subsequent presentations. Specifically, the Company disclosed that certain patients in the clinical trial taking the compound experienced an increase in blood pressure. Upon the release of this news, shares of the Company's stock plummeted $5.57 per share, or 38 percent, to close on October 28, 2008 at $8.84 per share, on unusually heavy trading volume.
Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Barroway Topaz Kessler Meltzer & Check which prosecutes class actions in both state and federal courts throughout the country. Barroway Topaz Kessler Meltzer & Check is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world.
For more information about Barroway Topaz Kessler Meltzer & Check or to sign up to participate in this action online, please visit www.btkmc.com
If you are a member of the class described above, you may, not later than April 7, 2009, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Any member of the purported class may move the court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
SOURCE Barroway Topaz Kessler Meltzer & Check, LLP