NEW YORK, July 1, 2016 /PRNewswire/ -- Pomerantz LLP announces that a class action lawsuit has been filed against Chiasma, Inc. ("Chiasma" or the "Company") (NASDAQ: CHMA) and certain of its officers. The class action, filed in United States District Court, District of Massachusetts, and docketed under 16-cv-11082, is on behalf of a class consisting of all persons or entities who purchased or otherwise acquired Chiasma securities between July 15, 2015 and April 17, 2016 inclusive (the "Class Period"). This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1934 (the "Exchange Act") and the Securities Act of 1933 (the "Securities Act").
If you are a shareholder who purchased securities during the Class Period, you have until August 8, 2016 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 firstname.lastname@example.org or 888.476.6529 (or 888.4-POMLAW), toll free, ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
Chiasma, a late-stage biopharmaceutical company, focuses on developing and commercializing oral forms of therapies for patients suffering from orphan diseases. Chiasma was founded in 2001 and is headquartered in Newton, Massachusetts.
The Company's lead product candidate is oral octreotide, or Mycapssa, for the treatment of acromegaly, a condition that results in the body's production of excess growth hormone. As of June 2015, prior to Chiasma's IPO, the Company had completed a multinational Phase 3 clinical trial of Mycapssa and submitted a new drug application ("NDA") to the U.S. Food and Drug Administration ("FDA") seeking approval for marketing and sale of Mycapssa.
On or about July 15, 2016, Chiasma completed its IPO, issuing 6.4 million shares and raising net proceeds of approximately $102 million.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Chiasma's Phase 3 clinical trial methodology for Mycapssa was not sufficient to demonstrate efficacy and secure FDA approval; (ii) Chiasma's supervision of its suppliers was not sufficient to prevent deficiencies that would delay FDA approval of Mycapssa; and (iii) as a result of the foregoing, Chiasma's public statements were materially false and misleading at all relevant times.
On April 18, 2016, before the market opened, the Company announced that the FDA had issued a Complete Response Letter regarding its NDA for Mycapssa, stating that the FDA did not believe the Company's application had provided substantial evidence of efficacy to warrant approval and advising Chiasma that it would need to conduct another clinical trial in order to overcome this deficiency. The FDA expressed concerns regarding certain aspects of the company's single-arm, open-label Phase 3 clinical trial and strongly recommended that the company conduct a randomized, double-blind and controlled trial that enrolls patients from the United States and be of sufficiently long duration to ensure that control of disease activity is stable at the time point selected for the primary efficacy assessment. In addition, the FDA advised that, during a recent site inspection, certain deficiencies were conveyed to the representative of one of Chiasma's suppliers that would need to be resolved before approval.
On this news, Chiasma's share price fell $6.42, or 63.13%, to close at $3.75 on April 18, 2016.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, 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
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SOURCE Pomerantz LLP