NEW YORK, July 9, 2021 /PRNewswire/ — Pomerantz LLP announces that a class action lawsuit has been filed against Orphazyme A/S (“Orphazyme” or the “Company”) (NASDAQ: ORPH) and certain of its officers and directors. The class action, filed in the United States District Court for the Northern District of Illinois, Eastern Division, and docketed under 21-cv-03640, is on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired: (a) Orphazyme American depositary shares (“ADSs”) pursuant and/or traceable to the Offering Documents (defined below) issued in connection with the Company’s initial public offering conducted on or about September 29, 2020 (the “IPO” or “Offering”); and/or (b) Orphazyme securities between September 29, 2020 and June 18, 2021, both dates inclusive (the “Class Period”). Plaintiff pursues claims against the Defendants under the Securities Act of 1933 (the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”).
If you are a shareholder who purchased or otherwise acquired (a) Orphazyme ADSs pursuant and/or traceable to the Offering Documents issued in connection with the IPO, and/or (b) Orphazyme securities during the Class Period, you have until September 7, 2021 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
Orphazyme is a biopharmaceutical company that develops therapies for the treatment of neurodegenerative orphan diseases. The Company conducts its U.S. operations through its wholly-owned subsidiary, Orphazyme US, Inc., which is focused on U.S. regulatory review and preparing for the Company’s first potential U.S. commercial launch, including legal, commercial, finance, advocacy relations, regulatory, and medical affairs functions.
Orphazyme’s lead drug candidate is arimoclomol, which is in clinical development for four orphan diseases, including Niemann-Pick disease type C (“NPC”), Amyotrophic Lateral Sclerosis (“ALS”), and Inclusion Body Myositis (“IBM”). In August 2017, Orphazyme initiated a multicenter randomized 1:1, double-blinded, placebo-controlled Phase 2/3 clinical trial for assessing efficacy and safety of arimoclomol citrate 400 mg three times per day in patients with IBM; in August 2018, Orphazyme initiated a 2:1 randomized, double-blinded, placebo-controlled Phase 3 clinical trial assessing efficacy and safety of arimoclomol citrate 400 mg three times per day in patients with ALS; and in September 2020, the U.S. Food and Drug Administration (“FDA”) accepted Orphazyme’s new drug application (“NDA”) for arimoclomol for NPC.
On September 4, 2020, Orphazyme filed a registration statement on Form F-1 with the U.S. Securities and Exchange Commission (“SEC”) in connection with the IPO, which, after several amendments, was declared effective by the SEC on September 28, 2020 (the “Registration Statement”).
On September 29, 2020, pursuant to the Registration Statement, Orphazyme’s ADSs began trading on the Nasdaq Global Select Market under the ticker symbol “ORPH.” That same day, Orphazyme filed a prospectus on Form 424B4 with the SEC in connection with the IPO, which incorporated and formed part of the Registration Statement (collectively, the “Offering Documents”).
Pursuant to the Offering Documents, Orphazyme conducted the IPO, issuing 3,966,146 of its ordinary shares to the U.S. public in the form of 3,966,146 ADSs at the Offering price of $11.00 per ADS, while concurrently offering 3,650,000 of its ordinary shares in Europe in a private placement to qualified investors, for total approximate proceeds of $77,913,174 to the Company before expenses and after applicable underwriting commissions.
The complaint alleges that the Offering Documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and were not prepared in accordance with the rules and regulations governing their preparation. Additionally, the complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and compliance policies. Specifically, the Offering Documents and Defendants made false and/or misleading statements and/or failed to disclose that: (i) arimoclomol was not as effective in treating IBM as Defendants had represented; (ii) arimoclomol was not as effective in treating ALS as Defendants had represented; (iii) the arimoclomol NDA for NPC was incomplete and/or required additional evidence and data to support the benefit-risk assessment of that NDA; (iv) as a result of (iii), the FDA was unlikely to approve the arimoclomol NDA for NPC in its present form; (v) the Company’s overall business prospects, as well as arimoclomol’s commercial prospects, were significantly overstated; and (vi) as a result, the Offering Documents and Defendants’ public statements throughout the Class Period were materially false and/or misleading and failed to state information required to be stated therein.
On March 29, 2021, Orphazyme issued a press release “announc[ing] its phase 2/3 trial evaluating arimoclomol for the treatment of [IBM] . . . did not meet its primary and secondary endpoints.”
On this news, Orphazyme’s ADS price fell $3.59 per ADS, or 28.97%, to close at $8.80 per ADS on March 29, 2021.
On May 7, 2021, Orphazyme issued a press release “announc[ing] topline data from pivotal trial of arimoclomol in [ALS.]” The press release disclosed that the Company’s “pivotal trial . . . did not meet its primary and secondary endpoints to show benefit in people living with ALS.”
On this news, Orphazyme’s ADS price fell $2.81 per ADS, or 32.83%, to close at $5.75 per ADS on May 7, 2021.
Then, on June 18, 2021, Orphazyme issued a press release announcing receipt of a Complete Response Letter from the FDA following the agency’s review of the NDA for arimoclomol for the treatment of NPC. The press release disclosed that the FDA had rejected the arimoclomol NDA for NPC “based on needing additional qualitative and quantitative evidence to further substantiate the validity and interpretation” of certain data and “that additional data are needed to bolster confirmatory evidence beyond the single phase 2/3 clinical trial to support the benefit-risk assessment of the NDA.”
On this news, Orphazyme’s ADS price fell $7.23 per ADS, or 49.66%, to close at $7.33 per ADS on June 18, 2021.
Finally, on June 21, 2021, investor resource website Seeking Alpha reported that “Orphazyme [was] cut to sell at Guggenheim after [the Company’s] regulatory snub” by the FDA, stating, among other things, that “[w]ith a $1.00 price target for the stock indicating a downside of ~86.4%, Guggenheim notes that there is ‘little optionality left in the stock,’ and adds ‘it might make sense to wind down the company.’”
On this news, Orphazyme’s ADS price fell $0.81 per ADS, or 11.05%, to close at $6.52 per ADS on June 21, 2021.
As of the time the complaint was filed, the price of Orphazyme ADSs continued to trade below the $11.00 per ADS Offering price, damaging investors.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, and Paris is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
Robert S. Willoughby
888-476-6529 ext. 7980
SOURCE Pomerantz LLP
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