A federal class-action lawsuit against Ann Arbor, Mich.-based Esperion Therapeutics alleges the drug-development company made false and misleading statements about regulatory hurdles it faced before it could commercialize its lead drug in fighting metabolic diseases.
The lawsuit was filed Friday by San Diego-based Robbins Arroyo in U.S. District Court for the Eastern District of Michigan in Detroit, alleging improper claims by company executives between Aug. 18 and Sept. 28 last year about its lead drug candidate, ETC-1002, a once-daily small molecule designed to lower levels of low-density lipoprotein cholesterol levels.
The complaint said that by early August, the company had finished Phase 2b human trials and had met with the U.S. Food and Drug Administration to discuss what the company needed to do before commercialization.
On Aug. 17, Esperion issued a release saying it would not have to conduct a lengthy and expensive cardiovascular outcomes trial before getting FDA approval.
The lawsuit alleges that on Sept. 28, Esperion issued another release, this time saying it was being encouraged by the FDA to conduct such an outcomes trial and that it might, in fact, be required.
The next day, shares in the company fell by $16.76 a share, to a close of $18.33. They opened Tuesday at $14.13, up from the 12-month low of $13.11 hit on Jan. 14.
“We feel the lawsuit is entirely without merit and we will do whatever is necessary to defend ourselves,” Mindy Lowe, the company's director of investor relations and communications, told Crain's on Tuesday.
Last March, Esperion was briefly a darling of Wall Street after releasing positive results of its Phase 2 trials. It hit a high of $118.95 on March 20. Based on that surge in share price, on March 24, Esperion raised $190 million in a secondary public offering.
The 12-month high of $120.96 was set May 21.