Robbins Arroyo LLP: CTI Biopharma Corp. (CTIC) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed in the U.S. District Court for the Southern District of New York. The complaint alleges that officers and directors of CTI Biopharma Corp. (NASDAQCM: CTIC) violated the Securities Exchange Act of 1934 and the Securities Act of 1933 in connection with the company’s September 24, 2015 public offering (the “Offering”) and/or between March 4, 2014 and February 9, 2016, by making materially false and misleading statements about CTI’s business prospects. CTI Biopharma is a biopharmaceutical company that acquires, develops, and markets novel targeted therapies for blood-related cancers in the United States and internationally. One of its most advanced products was pacritinib, a treatment for myleofibrosis.
CTI Biopharma Accused of Misleading Investors About the Effectiveness of its Drug
According to the complaint, CTI Biopharma failed to disclose that: (i) pacritinib was attributed as a potential cause in the death and injuries of several patients; (ii) its clinical trials showed the dangers of pacritinib usage; (iii) the company’s new drug application would likely be withdrawn; and (iv) this would affect the company’s future revenues. During 2014 through 2015, the company filed several Form 10-Q’s and Form 10-K’s with the U.S. Securities and Exchange Commission (“SEC”) touting the effectiveness of pacritinib. On September 24, 2015, CTI Biopharma filed with the SEC its Prospectus Supplement to complete the offering of 10 million shares of common stock offered with a previously filed Registration Statement, which was required to disclose known trends or uncertainties likely to have an impact on the company’s operations.
Then, on February 8, 2016, the company issued a press release announcing that a partial clinical hold had been placed on pacritinib by the U.S. Food and Drug Administration (“FDA”). The company further disclosed that the FDA had identified several fatal and life-threatening safety issues in pacritinib-treated patients, including: heart failure; hemorrhage, including intracranial hemorrhage; and arrhythmias, including sudden death. On this news, CTI Biopharma stock fell $0.68 per share, or over 60%, to close at $0.44 per share on February 8, 2016. On February 9, 2016, the company announced that the FDA had placed a full clinical hold on pacritinib. Under the full clinical hold, all patients must discontinue pacritinib immediately, and the company may not enroll any new patients or start pacritinib as initial or crossover treatment. The clinical hold led the company to withdraw its previously submitted new drug application for pacritinib. On this news, CTI Biopharma stock fell over 40% during intraday trading, to close at $0.30 per share on February 10, 2016.
CTI Biopharma Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.
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