Robbins Arroyo LLP: Keryx Biopharmaceuticals, Inc. (KERX) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed against Keryx Biopharmaceuticals, Inc. (NASDAQCM: KERX) in the U.S. District Court for the Southern District of New York. The complaint is brought on behalf of all purchasers of Keryx securities between February 25, 2016 and July 29, 2016, for alleged violations of the Securities Exchange Act of 1934 by Keryx’s officers and directors. Keryx is a biopharmaceutical company that focuses on providing therapies for patients with renal disease in the United States. Its product, Auryxia, is an oral, absorbable iron-based compound designed to control serum phosphorous levels in patients with chronic kidney disease on dialysis.
Keryx Accused of Hiding Production Problems Surrounding Its Drug Product
According to the complaint, throughout the class period, Keryx submitted several filings with the U.S. Securities and Exchange Commission and issued multiple press releases touting Auryxia’s solid foundation and positive forward-looking guidance about the company’s financial outlook. The company elaborated, “For 2016, we expect prescription volume to increase between 20 percent and 35 percent on a sequential quarter basis, ramping as we realize the full impact of our expanded sales force.” The company further stated, “[O]ur top priorities for this year are to increase adoption of Auryxia in the dialysis setting, submit a regulatory application seeking label expansion, and prepare for potential launch in 2017 in the new indication.” However, the complaint alleges that Keryx officials failed to disclose that: (i) the company was experiencing production-related difficulties in converting active pharmaceutical ingredient (“API”) to finished drug product; (ii) the foregoing difficulties were resulting in decreased production yields of finished drug product; and (iii) consequently, the company would exhaust its reserve of finished drug product.
On August 1, 2016, Keryx disclosed that an interruption in the supply of Auryxia tablets was going to occur due to a production-related issue concerning API at its contract manufacturer. The company further stated that current inventories of Auryxia are not sufficient to ensure uninterrupted patient access to the medicine, and that it expects to make Auryxia available to patients when the supply is back to adequate levels, likely in the fourth quarter of 2016. On this news, Keryx stock fell $2.64 per share, or 35.8%, to close at $4.72 per share on August 1, 2016.
Keryx 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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