Reata Pharmaceuticals, Inc. Class Action Lawsuit
- Company Name
- Reata Pharmaceuticals, Inc.
- Stock Symbol
- Class Period
- October 15, 2019 to August 7, 2020
- Eastern District of Texas
The Reata Pharmaceuticals, Inc. class action lawsuit charges Reata and certain of its executives with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers or acquirers of Reata securities between October 15, 2019 and August 7, 2020, inclusive (the “Class Period”). The Reata class action lawsuit was commenced on October 15, 2020 in the Eastern District of Texas and is captioned Patel v. Reata Pharmaceuticals, Inc., No. 20-cv-00796.
Reata is a clinical stage biopharmaceutical company that develops novel therapeutics for patients with serious or life-threatening diseases by targeting molecular pathways that regulate cellular metabolism and inflammation. Among Reata’s drug candidates under development is omaveloxolone, which is in Phase 2 clinical development to treat Friedreich’s ataxia (“FA”). Following the announcement of positive data from the MOXIe Part 2 study of omaveloxolone for FA in October 2019, Reata represented that it would seek submission for marketing approval of omaveloxolone for the treatment of FA in the United States with the U.S. Food and Drug Administration (“FDA”).
The Reata class action lawsuit alleges that during the Class Period defendants made false and/or misleading statements and/or failed to disclose that: (i) the MOXIe Part 2 study results were insufficient to support a single study marketing approval of omaveloxolone for the treatment of FA in the United States without additional evidence; (ii) as a result, it was foreseeable that the FDA would not accept marketing approval of omaveloxolone for the treatment of FA in the United States based on the MOXIe Part 2 study results; and (iii) as a result, Reata’s public statements were materially false and misleading at all relevant times.
On August 10, 2020, Reata issued a press release announcing its second quarter 2020 financial results, wherein it disclosed that the FDA “is not convinced that the MOXIe Part 2 results” of Reata’s study assessing omaveloxolone for the treatment of FA “will support a single study approval without additional evidence that lends persuasiveness to the results,” and that, “[i]n preliminary comments for [a] meeting, the FDA stated that [defendants] will need to conduct a second pivotal trial that confirms the mFARS [modified Friedreich’s Ataxia Rating Scale] results of the MOXIe Part 2 study with a similar magnitude of effect.” On this news, Reata’s stock price fell more than 33%, damaging investors.
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