Following nearly two years of hard-fought litigation, during which time Kessler Topaz represented court-appointed lead plaintiff, SEB Investment Management AB (“Plaintiff”) and a similarly situated class of Endo investors, the parties agreed to settle the case on August 22, 2019. Plaintiff’s claims arose out of the opioid epidemic that has swept across the United States. In February 2018, Plaintiff filed an amended complaint alleging that Endo and certain of its former officers (collectively, “Defendants”) made material misstatements concerning the abuse rates, safety, risks, and other attributes of Reformulated Opana ER, a highly profitable opioid analgesic that Endo marketed and sold during the Class Period.
As alleged in the action, against the backdrop of mounting nationwide concern over the rampant abuse of opioids and expiring patent-exclusivity for the original formulation of Opana ER, Endo sought to protect its lucrative Opana ER franchise. To that end, and in an effort to squelch looming generic competition, Endo developed Reformulated Opana ER, claiming it was safer a formulation of Opana ER. Endo submitted a New Drug Application (“NDA”) with the U.S. Food and Drug Administration (“FDA”) seeking FDA approval of Reformulated Opana ER, as well as an all-important abuse-deterrent label for the drug. The FDA granted approval of the NDA, but denied Endo’s request for abuse-deterrent labeling, citing concerns about adequacy of the data Endo submitted in support of the label request. Endo also attempted to convince the FDA that original Opana ER was removed from the market in favor of the purportedly safer Reformulated Opana ER, a move that, if successful, would have protected Endo’s profits from the lucrative opioid franchise. The FDA rejected Endo’s request.
Undeterred, throughout the Class Period, Defendants persisted in their efforts to obtain abuse-deterrent labeling for Reformulated Opana ER. To that end, Endo collected, reviewed, and submitted to the FDA post-marketing surveillance data concerning, among other things, the rates and routes of abuse of Reformulated Opana ER. All the while, Defendants repeatedly assured the market that this data supported an abuse-deterrent label and exhibited favorable trends related the rates and routes of abuse of Reformulated Opana ER. However, as Plaintiffs alleged, Defendants concealed from the market that this same data revealed, on a quarterly basis throughout the Class Period, that Reformulated Opana ER was being abused through the highly dangerous method of injection at significantly higher rates than the original formulation of the drug.
Following Endo’s submissions of this data to the FDA, the FDA announced it planned to convene an Advisory Committee meeting to assess the risk-benefit profile of Reformulated Opana ER in March of 2017. Following the meeting, the FDA Advisory Committee voted that the risks of the drug no longer outweighed its benefits, citing Endo’s own data showing a dramatic and sustained increase in injection abuse rates of Reformulated Opana ER, as well as other adverse health events specific to injection abuse of the drug. Two months later, the FDA demanded the Endo voluntarily withdraw Reformulated Opana ER from the market. Shortly thereafter, Endo complied. In response to these developments Endo’s stock price plummeted, damaging investors.
The court largely denied Defendants’ motion to dismiss Plaintiff’s amended complaint in December 2018. Thereafter, the parties commenced extensive discovery efforts, which included the exchange of over 400,000 documents from Endo and non-parties. While discovery efforts, class certification, and expert discovery were underway, and in light of Endo’s perilous financial condition from its substantial exposure in various other nationwide proceedings relating to the opioid crisis, the parties explored a mediated resolution of the case. These efforts, which spanned several months, resulted in an $82.5 million settlement, an outstanding recovery for the class of Endo investors.
For additional information regarding the settlement, please visit the settlement website at: www.EndoSecuritiesLitigationSettlement.com