Pomerantz Law Firm Announces the Filing of a Class Action Against Fractyl Health, Inc. and Certain Officers - GUTS

NEW YORK, Aug. 27, 2026 /PRNewswire/ -- Pomerantz LLP announces that a class action lawsuit has been filed against Fractyl Health, Inc. ("Fractyl" or the "Company") (NASDAQ: GUTS) and certain officers.   The class action, filed in the United States District Court for the Southern District of New York, and docketed under 26-cv-07167, is on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired Fractyl securities between January 13, 2025 and January 29, 2026, both dates inclusive (the "Class Period"), seeking to recover damages caused by Defendants' violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.

If you are an investor who purchased or otherwise acquired Fractyl securities during the Class Period, you have until October 20, 2026 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 Danielle Peyton at [email protected] or 646-581-9980 (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.  

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Fractyl is a metabolic therapeutics company that develops therapies for the treatment of type 2 diabetes and obesity.  The Company is developing, inter alia, the Revita DMR System ("Revita"), an outpatient procedural therapy designed to durably modify duodenal dysfunction, a pathologic consequence of a high fat and high sugar diet.

During the Class Period, Defendants were highly focused on advancing Revita through Fractyl's "REMAIN-1" study, evaluating Revita's efficacy in maintaining weight loss following the discontinuation of GLP-1 receptor agonist drug therapy.  The REMAIN-1 study is designed to include three distinct patient cohorts: (i) the REVEAL-1 Cohort; (ii) the REMAIN-1 Midpoint Cohort; and (iii) the REMAIN-1 Pivotal Cohort.

At all relevant times, Defendants touted Revita's efficacy as observed in interim data readouts from the REVEAL-1 and REMAIN-1 Midpoint Cohorts, while highlighting data from prior studies that likewise evaluated Revita's ability to reduce weight gain under other circumstances.  Defendants variously characterized such data as "groundbreaking", "clinically and statistically significant", and "striking", while highlighting the purported "[c]lear evidence of Revita activity".  (Emphasis in original.) 

In August and September 2025, on days coinciding with the release of positive data readouts purportedly demonstrating Revita's efficacy potential, Defendants announced public offerings of Fractyl securities, reaping tens of millions of dollars in proceeds, piggybacking on the hype generated by these purportedly promising results.

The complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operations, and prospects.  Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Revita was less effective than Defendants had led investors to believe, and/or operational issues at one or more of the REMAIN-1 Midpoint Cohort's clinical sites compromised the integrity of its efficacy results; (ii) accordingly, Revita's clinical, regulatory, and commercial prospects were overstated, as was the REMAIN-1 Midpoint Cohort's ability to assess Revita's efficacy; and (iii) as a result, Defendants' public statements were materially false and misleading at all relevant times.

The truth began to emerge on January 29, 2026, when, during pre-market hours, Fractyl issued a press release announcing six-month data from the REMAIN-1 Midpoint Cohort.  The press release disclosed, in relevant part, that "[a]cross the prespecified efficacy population . . . , Revita-treated patients experienced a 4.5% weight regain vs 7.5% in the sham arm at 6 months", representing a significantly more modest efficacy result than previously disclosed results and falling short of investor expectations, while stating that "[t]he Midpoint Cohort was not designed to be sufficiently powered for efficacy analysis[.]"

The same day, also during pre-market hours, Fractyl hosted a conference call with investors and analysts to discuss the six-month data from the REMAIN-1 Midpoint Cohort.  During the call, Fractyl's Chief Executive Officer Defendant Harith Rajagopalan ("Rajagopalan") indicated that issues at one of the REMAIN-1 Midpoint Cohort study sites, which "had higher-than-expected regain across both arms," were at least partly to blame for the cohort's disappointing six-month efficacy results.

Following these disclosures, Fractyl's stock price fell $1.245 per share, or 68.03%, to close at $0.585 per share on January 29, 2026.

The same day, during post-market hours, Canaccord Genuity issued a report on Fractyl, providing additional color on the site-specific issue identified by Defendant Rajagopalan.  Specifically, the report cited a "call with mgmt [that] clarified some of the key FAQs around the 'outlier site'", stating that Fractyl "attribute[d] the variability in the 1 outlier site (out of 6) to a relatively less robust diet and lifestyle counseling program", noting that "[t]his site was the first to enroll and hadn't yet set up a dietary center."

Also on January 29, 2026, during post-market hours, Morgan Stanley issued a report on Fractyl, downgrading the Company to an "Equal-weight" from "Overweight" rating and cutting its price target on the Company's stock to $2.00 from $8.00.  The report characterized the latest REMAIN-1 Midpoint Cohort study results as "[d]isappoint[ing]", noting that the "[r]andomized 6mo results for Revita in weight maintenance showed trends, but fell short of expectations, raising questions."  Specifically, the report noted that "Revita patients experienced 4.5% weight regain (+1.5% in open label cohort) vs. 7.5% sham (~10% expected)", which "represents a 40% delta vs. sham, below the 50% threshold, suggesting more modest benefits, though was negatively impacted by a single site."  Notwithstanding Defendants' "indicat[ion that the] results were negatively impacted by a single site," the report concluded that "we take a more cautious view on the potential of Revita and move to the sidelines", and "[g]iven our more cautious view, we lower our probability of success for Revita to 35% from 50%, previously" and "now model peak risk-adjusted worldwide sales of ~$490M in 2035 (previously $700M)[.]"

Following the release of the Canaccord Genuity and Morgan Stanley reports, Fractyl's stock price fell $0.125 per share, or 21.37%, to close at $0.46 per share on January 30, 2026.

Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, 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, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz 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 billions of dollars in damages awards on behalf of class members. See www.pomlaw.com. 

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CONTACT:
Danielle Peyton
Pomerantz LLP
[email protected]
646-581-9980 ext. 7980

SOURCE Pomerantz LLP