“Life Sciences” A Securities Fraud Lightening Rod
March 25, 2015
One sector, life sciences, stands out as a target of securities fraud class actions in 2014, according to a study from Dechert attorney David A. Kotler. The number of such lawsuits targeting pharmaceutical, biotechnology and medical companies more than doubled from 2013 to 2014 (from 19 to 39). Kotler notes that, in terms of the allegations, there was the continuation of a recent trend toward “industry-specific” claims, as opposed to general claims about financial improprieties. In the context of life sciences, this could mean, for example, an allegation that a product’s efficacy had been misrepresented. The writer also notes that, while the increase in the number of suits was dramatic, in fact many of them were dismissed. The study concludes with suggestions for minimizing the risk of becoming a target.
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