BOSTON, Oct. 16, 2015 /PRNewswire/ -- Shares in Zafgen, Inc. ("Zafgen" or the "Company") (NASDAQ: ZFGN), a Boston biotech company developing treatments for obesity and metabolic disorders, have plunged more than 40% after it was announced that FDA regulators were placing a partial hold on Zafgen's primary drug, beloranib. The Company has announced that the hold will affect all ongoing and planned trials for beloranib.
On Wednesday, October 14th, the Company revealed that a patient had died during late stage trial testing of the drug for treating Prader-Willi syndrome, a rare genetic disorder that leads to obesity. However, at the initial time of the announcement, it was undisclosed whether the patient was part of the control arm of the study or if the patient was receiving the drug. Between Wednesday's announcement and Friday's news, the clinical trial was unblinded and it was confirmed that the deceased patient was receiving beloranib.
Shares of the Company, which had already dropped significantly following the initial news of the patient's death, lost more than 40% of their remaining value on October 16, 2015, representing a loss of market capitalization of approximately $250 million to investors. Since the announcement of the patient's death, the market capitalization loss has been well over $600 million, or 66% of Zafgen's value.
Block & Leviton LLP is investigating Zafgen and certain of its officers and directors to learn the facts behind the Company's October 16, 2015 and related announcements and to determine whether any insiders knew, or were severely reckless in not knowing, about safety issues with beloranib or if they committed other wrong-doing.
If you purchased Zafgen stock on or before October 16, 2015 and have questions about your legal rights, or if you have information relevant to this investigation, please contact attorney Steven P. Harte of Block & Leviton LLP at (617) 398-5600 or at [email protected]. Confidentiality for any whistleblowers or other persons with information relevant to the investigation is assured.
Block & Leviton is a Boston-based law firm representing investors for violations of securities laws as well as whistleblowing employees who provide information about their employers' violations of law. The firm's lawyers have collectively been prosecuting securities cases on behalf of investors for over 70 years.
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Steven P. Harte
SOURCE Block & Leviton LLP