Fortress Biotech, Inc. Class Action Lawsuit
- Company Name
- Fortress Biotech, Inc.
- Stock Symbol
- Class Period
- December 11, 2019 to October 9, 2020
- Eastern District of New York
The Fortress Biotech, Inc. class action lawsuit charges Fortress Biotech and certain of its executives with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers or acquirers of Fortress Biotech securities between December 11, 2019 and October 9, 2020, inclusive (the “Class Period”). The Fortress Biotech class action lawsuit was commenced on November 27, 2020 in the Eastern District of New York and is captioned Cushman v. Fortress Biotech, Inc., No. 20-cv-05767.
Fortress Biotech develops and commercializes pharmaceutical and biotechnology products. In December 2019, Fortress Biotech’s majority-controlled subsidiary, Avenue Therapeutics, Inc., which Fortress Biotech founded in 2015, submitted a New Drug Application (“NDA”) for its intravenous (“IV”) Tramadol product to the U.S. Food and Drug Administration (“FDA”) for the management of moderate to moderately severe pain in adults in a medically supervised health care setting.
The Fortress Biotech class action lawsuit alleges that, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (i) IV Tramadol was not safe for the intended patient population; (ii) as a result, it was foreseeable that the FDA would not approve the NDA for IV Tramadol; and (iii) as a result, Fortress Biotech’s public statements were materially false and misleading at all relevant times.
On October 12, 2020, Avenue Therapeutics disclosed receipt of a Complete Response Letter (“CRL”) from the FDA regarding the NDA for its IV Tramadol product. Specifically, the FDA advised Avenue Therapeutics that “it cannot approve the application in its present form” because “IV tramadol, intended to treat patients in acute pain who require an opioid, is not safe for the intended patient population.” Specifically, the CRL stated: “[I]f a patient requires an analgesic between the first dose of IV tramadol and the onset of analgesia, a rescue analgesic would be needed. The likely choice would be another opioid, which would result in opioid ‘stacking’ and increase the likelihood of opioid-related adverse effects.” On this news, Fortress Biotech’s stock price fell nearly 24%, damaging investors.
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