- Company Name
- Nektar Therapeutics
- Stock Symbol
- Class Period
- February 15, 2019 to August 8, 2019
- Motion Deadline
- October 18, 2019
- Northern District of California
The complaint charges Nektar and certain of its former officers with violations of the Securities Exchange Act of 1934. Nektar is a biopharmaceutical company that develops medicines in areas of high unmet medical need, including therapies for cancer, autoimmune disease, and chronic pain. The Company’s lead immuno-oncology candidate is NKTR-214, a biologic substance developed to stimulate proliferation and growth of tumor-killing immune cells. The benefits, safety, and tolerability of NKTR-214, in combination with another drug, Opdivo, were being evaluated in Nektar’s PIVOT-2 clinical study.
The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements and/or failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, defendants failed to disclose that the Company was not in compliance with current good manufacturing practices and, as a consequence, batches of NKTR-214 were not being produced consistently, which caused the clinical results from the PIVOT-02 study to differ based on the batch of NKTR-214 used. This lack of consistency in the batches of NKTR-214 resulted in the failure of the PIVOT-2 study to produce statistically significant results that would support a finding of clinical benefit. As a result of this information being withheld from the market, Nektar securities traded at artificially inflated prices during the Class Period, allowing certain of the defendants to sell their personally held Nektar stock at prices as high as $43.20 per share for proceeds of more than $13 million.
Then on August 8, 2019, after the market closed, the Company revealed that a manufacturing issue had caused 2 batches of NKTR-214 to differ from the other 20 batches that were produced. Moreover, these batches resulted in variable clinical benefit than the other batches used in the Company’s PIVOT-02 clinical trial. On this news, the Company’s stock price fell $8.65 per share, or nearly 30%, to close at $20.92 per share on August 9, 2019.