Introduction

This update addresses developments in securities class actions brought against life sciences companies in 2015. It provides an overview and analysis of trends in decisions involving life sciences companies with products at two distinct stages of development – pre and post-Food and Drug Administration (FDA) approval.(1)

At the most basic level, the cases analysed share a common feature. In each, a life sciences company suffered a setback that, when publicised, was followed first by a stock price decline and then by litigation initiated by shareholders seeking to recover investment losses. Such setbacks can occur at any stage of a company's development, but in the life sciences sector – given particular issues relating to drug development, regulatory approval and continued regulatory oversight of manufacturing, marketing and sales activities – the setbacks are clustered around a few prominent stages of the company lifecycle.

A detailed review of the individual cases discussed in this update is available at www.sidley.com/~/media/update-pdfs/2016/05/securities-class-actions-in-the-life-sciences-sector-2015-annual-survey.pdf.

Repercussions of Omnicare

The Supreme Court's activity in the area of securities litigation generally in 2015 offers a noteworthy background. In March 2015 the court handed down its decision in Omnicare, which dealt with liability for allegedly misleading statements of opinion.(2) At issue was whether – for the purposes of a claim under Section 11 of the Securities Act 1933 (involving representations made in stock registration statements) – a plaintiff may allege that an opinion statement was untrue simply by pleading that the opinion was objectively wrong or, in contrast, whether a plaintiff must also plead (and eventually prove) that the speaker did not actually believe the statement. The court held that in Section 11 cases, as in cases brought under Section 10(b) of the Securities Exchange Act, a statement of opinion is actionable only if the speaker did not actually hold that opinion – a favourable outcome for securities defendants.

However, Omnicare also provides securities plaintiffs with a potential path to victory in cases in which they allege that an opinion statement is misleading by way of omission. The court held that reasonable investors, in hearing a statement of opinion, will expect that the speaker has taken certain steps and acquired certain knowledge that forms the basis of that opinion. If the speaker has neither done so nor disclosed that he or she has failed to take such steps, the opinion statement may be misleading by virtue of that omission. This is what might be called the 'offensive' use of Omnicare, and in two 2015 decisions – BioScrip and Merck – the courts drew on this approach in reaching results favourable to Section 10(b) plaintiffs.(3) However, most courts that applied Omnicare in life sciences cases in 2015 did so in the defendants' favour, by dismissing Section 10(b) claims in which plaintiffs were unable to plead subjective falsity.

Development-stage drugs and devices

In 2015, by far the largest number of decisions issued by federal courts in securities litigation against life sciences companies involved products at the pre-approval stage. In contrast with the 2014 decisions – which split evenly between victories for companies and victories for plaintiffs in this area – the 2015 district court decisions broke decisively in favour of defendants, with a total of 14 victories on motions to dismiss or summary judgment and only three losses.(4) Appellate decisions were more evenly split, with two victories for defendants in unpublished and fairly cursory decisions and one win for plaintiffs in a more fully analysed published opinion.

Several themes emerge from the decisions in which companies prevailed. In a number of these cases, plaintiffs complained that the company had hidden the risk that a drug would not be approved or that a trial would not succeed. In assessing these claims, the courts were willing to look closely at the larger record of the company's public statements and often concluded that the supposedly hidden risks were in fact revealed. In doing so, the courts drew on a variety of sources, from the risk disclosures in a company's Securities and Exchange Commission (SEC) filings to publications in medical or scientific journals and information on FDA websites.

Another consistent theme is the recognition that the approval process is one of give and take, and that companies have no obligation to report every comment, question or concern expressed by regulators during that process. The case law consolidated on this point in 2015 in a way that should prove helpful to companies faulted for not disclosing interim communications with the FDA.

Finally, in several of the favourable decisions, the courts recognised that a company's public statements in this area often consist of opinions or deal with future occurrences that cannot be foreseen. In these decisions too – some of which draw on Omnicare – the results were favourable for companies; statements of opinion or prediction are rarely found to be false or misleading, let alone knowingly so.

Three notable topics arise from the 2015 decisions involving development-stage companies or products:

  • the treatment of interim agency communications;
  • the evolving law on statements of opinion after Omnicare; and
  • the role of insider stock sales in the analysis of scienter in close cases.

Interim FDA communications
In a significant number of the 2015 decisions, courts confronted claims that defendants committed fraud by failing to disclose negative comments made by the FDA at an interim stage in the approval process. In most – but not all – of these cases, the courts granted the companies' motions to dismiss.

The facts in these cases fall largely into the same basic pattern. At some point before approval, the FDA communicates its concerns about an aspect of the drug candidate or trial design. This may take the form of a written comment in a letter or report or an oral statement made during a company's in-person meetings with FDA staff. Unless the company (or the FDA) discloses the comment when it is made, investors often do not learn about it until near the end of the approval process, when FDA staff or an advisory committee publicly release comprehensive briefing documents summarising events from earlier stages in the process. Plaintiffs' attorneys who see these comments for the first time when bad news is announced take the position that the comments constitute material information that the company is required to disclose to the investing public – and that by failing to make such disclosures at the relevant time, the company committed fraud.

In many of these cases, the courts began by making two significant legal points, both favourable to defendants:

  • Section 10(b) of the Securities Exchange Act does not impose an affirmative duty to disclose material information. The defendants' duty under the statute is only to refrain from making false or misleading statements. The courts often cited the Supreme Court's 2011 Matrixx decision in making this point.(5)
  • Companies that routinely interact with the FDA are not required to disclose all of their communications with the FDA; in particular, companies need not disclose statements that are less than definitive or part of the give and take inherent in the regulatory process. With respect to the latter issue, in two 2015 decisions – Sanofi and EDAP(6) – the Southern District of New York usefully compiled 20 years' worth of case law that can be cited to support the point that companies have no independent duty to disclose interim inquiries or feedback from the FDA.

Applying these two principles, the courts rejected the plaintiffs' claims in most of the 2015 decisions that deal with the issue. A good example is Amarin,(7) where, in a pre-new drug application (NDA) meeting, the FDA called the company's attention to trials being conducted by third-party drug developers and told the company that the results of those third-party trials would be "important" in the FDA's evaluation of the company's own application. The plaintiffs claimed that the company wrongly failed to disclose this information when it first became available. The court rejected the claim, taking as its point of departure the first of the two principles above: Section 10(b) imposes no obligation to disclose and a disclosure duty arises only where a company has made an affirmative statement that would be rendered misleading by virtue of the omitted information. The court found no such statement in Amarin, as the company had never affirmatively characterised the significance of the third-party studies.

Amarin thus requires plaintiffs to demonstrate a specific connection between the omitted FDA comment and the statements that the company made – something close to a direct contradiction between the two. In Sarepta,(8) another case in which investors argued that the company had not sufficiently disclosed concerns raised by the FDA in pre-NDA meetings, the court explicitly articulated a 'contradiction' standard. In rejecting the plaintiffs' omission theory, the court held that:

"Defendants were under no duty… to delve into the FDA's specific concerns over the sufficiency of [the company's] potential NDA, at least absent their making of statements that would contradict such concerns."

In other cases involving claims that a company failed to disclose negative interim communications, the courts focused on the specific content of the FDA's comments, rather than the exact nature of the company's public statements. In several cases, the courts found that the plaintiffs' attorneys were overstating the magnitude or definitiveness of what the FDA had said. In Sanofi,(9) for example, the plaintiffs faulted the company for failing to disclose the FDA's comment that it would require greater certainty in results from a single-blind study than from a double-blind study. The court rejected that challenge. The court held that although the company could have reported the FDA's comment, its failure to do so was not misleading, largely because the comment fell short of a definitive statement that an application based on a single-blind study would fail.

The district court decision in VIVUS(10) is similar. In this case, the plaintiffs argued that the company had wrongly failed to disclose one regulator's statement that a drug could not be approved without an additional safety study. The court began with one of the two favourable principles above: the company was "not required to report every communication it had received from a regulator". The court went on to find that the statement which plaintiffs faulted the company for not disclosing represented only the position of a single advisory committee member, not the position of the committee or FDA as a whole.

Much the same was true in EDAP,(11) where the plaintiffs faulted the defendants for failing to report the FDA's concern with the company's use of metastasis-free survival, as opposed to overall survival, as the primary endpoint in its trial. The court noted that the FDA had told the company that the endpoint that it had chosen was less than ideal, but had not stated definitively that it would not accept an application based on a study with that endpoint. The court also distinguished cases in which companies had reported FDA communications, but had plainly cherry-picked the information that they chose to disclose, announcing the positive aspects of a letter or report but withholding the negative aspects.

However, not all of the 2015 decisions in this area were favourable for companies. In the unfavourable cases, as in those decided in the defendants' favour, the courts began with the premise that Section 10(b) does not impose a freestanding disclosure duty, and that the statute requires disclosure only when necessary to keep a company's affirmative statements from becoming misleading. But in examining companies' affirmative statements, these courts concluded that the omitted information in fact was necessary to prevent misdirection. This was the case in Chelsea Therapeutics,(12) where the company told investors that the FDA had questioned whether its trials had adequately established a durable treatment effect, but did not disclose that FDA staff had also recommended that the drug not be approved. The trial court granted the company's motion to dismiss, but the Fourth Circuit reversed, holding that this combination of disclosure and non-disclosure with respect to a single communication could support an inference that the company deliberately misled investors.

In Pain Therapeutics,(13) a summary judgment decision, the court took a broader approach. The company in this case had established the efficacy of the drug for which it sought approval, but faced difficulties showing that the active ingredient in the drug was stable. The FDA sent the company a discipline review letter in which it questioned the methods that the company had proposed to address the stability problem. The court concluded that the plaintiffs had established a triable omission claim based on the company's failure to disclose the discipline review letter. The question was not – as it had been in Chelsea Therapeutics – whether a company that elects to discuss a given FDA communication becomes obligated to provide additional information about that communication in order to keep its disclosure from being misleading. Instead, the question was whether a company that has discussed an issue relating to its drug candidate takes on a duty to report subsequent interim communications relating to that issue. The court found that the company did take on such a duty:

"[Once the defendants] chose to make concerns about [the drug's] stability data public… [they] thereby obligated themselves to disclose significant facts related to the stability of the [drug]."

Aveo(14) reflects a similar analysis. In this case, the plaintiffs faulted the company for failing to disclose that during a face-to-face meeting, FDA personnel had expressed concern about the failure of a trial to meet its secondary endpoint and had recommended that the company complete another trial before submitting its NDA. In holding that the plaintiffs had sufficiently alleged false or misleading statements, the court explained that "when a corporation does make a disclosure – whether it be voluntary or required – there is a duty to make it complete and accurate". In the same vein, the court held that "a failure to disclose FDA's serious criticism is a material omission".

The approach taken in Pain Therapeutics and Aveo appears to be significantly broader than – and possibly inconsistent with – the approach adopted in Amarin and other favourable decisions cited above. In those and earlier decisions, the courts emphasised that securities defendants have no duty to provide complete information, and suggested that a statement becomes misleading by way of omission only if it is contradicted by the omitted information. The latter approach appears to be the better one and is certainly more strongly supported by appellate authority. Since 2002, the Ninth Circuit has repeatedly stressed that securities defendants have no "duty of completeness" and that the irreducible minimum of a Section 10(b) claim is a misleading statement, not an incomplete one.(15) District courts have relied on these holdings; in 2015 in particular, the Northern District of California did so in a particularly thorough decision in AcelRx.(16) Thus, to the extent that Pain Therapeutics and Aveo can be read as requiring complete disclosures, they appear to represent a distinctly minority position on this point.

Statements of opinion
In several decisions involving products at the pre-approval stage, the courts began to apply Omnicare, the Supreme Court's 2015 decision dealing with statements of opinion in Securities Act cases. The simplest application of Omnicare appears in cases where plaintiffs challenge what are plainly statements of opinion, but fail to plead facts showing that defendants did not sincerely hold those opinions. The courts in these cases assumed that Omnicare applies to Section 10(b) claims as well as to Securities Act claims, and found that it supports dismissal in such circumstances. This was the case in both Sarepta and Invivo.(17)

A more nuanced application appears in Amarin, where the plaintiffs sought to use Omnicare's 'offensive' holding on omissions to their advantage. As noted, Omnicare held that a statement of opinion may be actionable if a reasonable investor would assume that the speaker made certain enquiries in the course of forming that opinion and had a reasonable basis for it – but the speaker in fact did not make such enquiries and lacked a basis for the opinion. The plaintiffs in Amarin tried to apply that framework to interim FDA communications. They argued that the company's optimistic opinion statements about approval were actionable under Omnicare, because the plaintiffs failed to disclose the fact that the FDA had told the company that third-party trials would provide important information about Amarin's own application. The court rejected that theory, holding that (assuming Omnicare applied to Section 10(b) claims) a reasonable investor would not have expected the basis of the company's opinion to be any different from the basis that actually existed at the time.(18)

A final decision illustrates the interaction of the developing law regarding statements of opinion and the existing law concerning disclosure of interim communications. In OvaScience(19) the company began testing a product without first filing an investigational new drug application, believing that the product qualified for an exemption. The company received, but did not completely disclose, an informal letter in which the FDA stated that, based on limited information, it believed that the product was not exempt. The plaintiffs argued that the company should have disclosed the details of that letter and the court agreed. The court began with the familiar proposition that companies have no duty to disclose interim FDA communications as an initial matter, and that a duty arises only if the company makes an affirmative statement rendered misleading by virtue of the omitted information. The court then found that the company had made such a statement – it had stated in quarterly filings that it believed the product was exempt, but that the FDA "could" disagree. That statement, the court held, was misleading insofar as the FDA had already told the company – albeit not definitively – that it disagreed with the position that the product was exempt.

Nevertheless, the court ultimately granted the company's motion to dismiss on scienter grounds. The court held that the plaintiffs were required to establish that the company knew that the FDA would ultimately hold the product to be outside the exemption, and that the plaintiffs had not done so. Certain actions taken by the company (ie, disclosure of the existence of the letter) were evidence that it subjectively believed that its position would be vindicated. Other facts – continuing developments in the FDA's consideration of the matter – showed an objective basis for that belief. In this way, a statement of opinion that the court had deemed misleading was ultimately not actionable.

Scienter and insider stock sales
In several decisions at the pre-approval stage, the courts gave particular weight to officers' stock sales where issues of scienter otherwise presented a close call. In Aveo the court found that the defendants owed and breached a duty to report the FDA's stated concerns about the failure of a trial to meet its secondary endpoint. Ultimately, however, the court dismissed the plaintiffs' claims on scienter grounds. A key factor in the court's analysis was the absence of insider stock sales.

On the other side of the ledger is Chelsea Therapeutics, in which the district court likewise relied on the absence of stock sales to conclude that the plaintiffs failed to adequately plead scienter. But the Fourth Circuit reversed this decision, holding (among other things) that the district court had erred in relying on this factor.

In Vertex(20) the presence of insider sales made the case a close one. The defendants in this case conceded that the challenged statements were false: the company had made an error in analysing clinical trial data and, as a result, overstated the positive outcome of the trial. The class period was short – less than one month – and some defendants had made significant stock sales during that period. The court nevertheless granted the defendants' motion to dismiss, finding that the defendants had offered benign, plausible explanations of their sales. Even significant stock sales, the court found, could not transform a mistake in analysing data into a deliberate fraud on the securities markets.

Stock promotion activities

Three decisions were issued in 2015 in a new sub-category of case – those in which relatively small, thinly capitalised companies with development-stage products are accused of illegal stock promotion activities. In each case, the company was alleged to have paid authors, through investor relations firms acting as intermediaries, to write favourable articles about the company and its products, thereby boosting stock prices shortly before the company made a public stock offering.

The plaintiffs pursued various theories of liability arising from this fact pattern. They argued that the companies made false or misleading statements insofar as they failed to disclose the financial arrangements behind favourable media coverage. The plaintiffs also asserted that the defendants participated in a fraudulent "scheme" involving conduct beyond the making of false or misleading statements. In two cases, the plaintiffs sued the investor relations firms and writers, as well as the company and its officers and directors. In one case, the plaintiffs also brought a separate insider trading claim against officers and directors who sold stock during the period in which the favourable articles appeared.

The 2015 decisions in this area all arose from complaints filed in 2014, following media exposés of alleged stock promotion schemes at several companies. Those exposés were followed by a downturn in stock price, which in turn prompted the plaintiffs' attorneys to enter the picture. The SEC also began investigating certain companies following publication of the exposés in 2014. It remains to be seen whether more litigation will arise in this area. The cases filed to date have involved a partially overlapping set of investor relations firms and some overlap among outside directors on the various companies' boards.

In two of the 2015 decisions, Galena and CytRx,(21) the courts largely denied the defendants' motions to dismiss. In the third, Galectin,(22) the court granted the defendants' motion. The critical distinction between Galena and CytRx on the one hand and Galectin on the other appears to be that the plaintiffs in Galectin did not allege that the company had ultimate authority over the content of the paid articles. The Galectin court held that there is nothing inherently improper in paying for favourable coverage and that even if a duty to disclose payment terms is breached, that duty belongs to the writers of the articles, not the company.

Post-approval drugs and devices

In 2015 fewer decisions were issued involving companies with products already on the market. Leaving aside one decision concerning early launch-stage issues, seven of the 11 decisions surveyed related to unfavourable post-approval regulatory developments. These decisions reflect several significant legal developments or principles. The basic fact pattern in these cases is largely the same. A company is notified by the FDA or another agency that, in the regulator's view, some aspect of the company's activity is improper or is being investigated. The company may disclose this immediately or wait until the regulator has issued a formal notice of violation. The company's stock price falls on the announcement and the plaintiffs' attorneys seek to characterise the matter as one not only of regulatory non-compliance, but also of securities fraud. Under an omission theory, the plaintiffs argue that the company should have disclosed that it was engaged in the targeted activity. The plaintiffs also try to find affirmative public statements that are arguably inconsistent with the underlying conduct – for example, "our policy is not to engage in off-label marketing" or "we are in compliance with applicable laws and regulations".

In five of the seven decisions in this group, the companies prevailed on motions to dismiss or motions for summary judgment. Two of the five favourable decisions were somewhat unusual in that the courts agreed with the plaintiffs that the defendants had made false or misleading statements, but then dismissed because the plaintiffs had not shown that the statements were materially false (Pacira(23)) or knowingly false (Ariad(24)).

One of the most significant decisions in this area is the sole appellate one. In Abiomed(25) the First Circuit affirmed the dismissal of claims stemming from the FDA's finding that the company was engaged in off-label marketing – a finding that ultimately led the company to recall all of its marketing materials. The plaintiffs challenged (among other things) the company's statement in its SEC filings that its policy was not to engage in off-label marketing. The First Circuit, like the district court, rejected the claim. The company had disclosed the relevant underlying conduct, the court held, and was not required to go further and pejoratively characterise its activities as improper. In other words, the company was not required to agree with the FDA that its actions were illegal; the securities laws had to leave "some room for give and take between a regulated entity and its regulator". That holding echoes the rulings of many decisions in the pre-approval context, in which the courts similarly left "room for give and take" by holding that companies need not disclose every FDA communication relating to approval.

The district court decision in TranS1(26) reflects a similar approach. In this case, the company engaged in what regulators viewed as billing fraud; the plaintiffs then argued that the company also committed securities fraud by failing to disclose that it was engaged in an illegal billing scheme. The court rejected that argument, finding that the company had openly disclosed the actions that the regulators deemed improper, and that because the plaintiffs had not alleged that the company knew at the time that those actions were improper, there was no fraud. Pacira, another off-label marketing case, was similar. The court there concluded that because both the company's marketing activities and the approved label indication were matters of public record, there could be no fraud; investors could judge for themselves whether the company was putting itself at risk of regulatory scrutiny or action.

On the other hand, where the plaintiffs can allege both that the company was engaged in activity later deemed to be illegal and that the company was already on notice that regulators were investigating it, the plaintiffs may under some circumstances be able to state a claim. This was the case in BioScrip, where the company learned that it was being investigated for possible violations of anti-kickback laws, but nevertheless included in its SEC filings the statement that it believed that it was in compliance with applicable laws and regulations. The court concluded that the plaintiffs had pled an omission claim under Omnicare, which provides investors with a way to challenge statements of opinion when certain facts relating to the basis of that opinion are not disclosed. The BioScrip court concluded that the existence of an ongoing investigation by regulators is the kind of fact that reasonable investors would expect to be disclosed when a company provides a legal compliance opinion – and that because the company had not disclosed it, the plaintiffs had identified an actionable omission.

However, in other situations the courts concluded that the heavily regulated nature of a life sciences company's business itself cuts against an inference of fraud. Thus, in Ariad the court agreed with the plaintiffs that the company had made false or misleading statements by favourably characterising the safety of its drug despite a high incidence of adverse events. Nevertheless, the court dismissed the plaintiffs' claims, concluding in effect that because the company was subject to constant FDA scrutiny in the area, fraud would not be feasible and therefore an intent to mislead could not be inferred. In Iradimed(27) too, the court found that the background of tight regulation in the medical device field undermined the plaintiffs' fraud claims. In this case, the company received a Form 483, which it disclosed as having arisen from a routine inspection. Later, based on the same issues identified in the Form 483, the FDA determined that the device at issue was adulterated and ordered the company to cease distribution. The court rejected the plaintiffs' challenge to the term 'routine', observing that inspections in fact are routine in the industry and that as a result, companies have no duty to disclose all inspections, all Forms 483 or even all warning letters. Thus, in this area, as in many of the favourable decisions in the pre-approval setting, the courts continue to show a fairly nuanced understanding of the regulatory context in which life sciences companies operate. Where the courts apply that understanding, they generally conclude that the regulatory setback suffered by a company does not also amount to fraud on the company's investors.

Finally, 2015 saw another chapter in the long-running litigation against Merck in connection with the anti-inflammatory drug Vioxx, which was approved in 1999 and withdrawn from the market in 2004. This multi-district litigation has been active for more than 10 years and has been the subject of multiple appellate proceedings, including a 2010 Supreme Court decision. After extensive discovery and fact development, Merck moved for summary judgment and the federal district court in New Jersey largely denied that motion in May 2015. The court emphasised that Merck was not broadly liable under the securities laws for any and all ostensibly improper conduct related to Vioxx; rather, the securities statutes are more narrowly focused on the accuracy of a company's public statements about its business. Nevertheless, the court concluded that the plaintiffs had presented sufficient evidence to proceed to a jury trial on the issue of whether the company had made false and misleading statements in defending the safety of its drug. The court found that the plaintiffs had compiled a record of internal communications that called into question both the accuracy of the company's statements and the sincerity of its professed belief that the drug was safe. Among other things, the Merck court applied Omnicare in the same "offensive" way as the BioScrip court, holding that the plaintiff had stated actionable omission claims by pointing to internal information that did not fairly align with the opinions that the company was expressing publicly.

For further information on this topic please contact Sara Brody, Robin Wechkin, Sarah Hemmendinger or Norman J Blears at Sidley Austin LLP by telephone (+1 415 772 1200) or email (sbrody@sidley.com, rwechkin@sidley.com, shemmendinger@sidley.com or nblears@sidley.com). The Sidley Austin LLP website can be accessed at www.sidley.com.

Endnotes

(1) For detailed summaries of the 2015 cases surveyed in this overview, please see www.sidley.com/~/media/update-pdfs/2016/05/securities-class-actions-in-the-life-sciences-sector-2015-annual-survey.pdf.

(2) Omnicare, Inc v Laborers District Council Construction Industry Pension Fund, 135 S Ct 1318 (2015).

(3) In re BioScrip, Inc Sec Litig, 2015 WL 1501620 (SDNY March 31 2015); In re Merck & Co, Inc Sec, Deriv & "ERISA" Litig, 2015 WL 2250472 (DNJ May 13 2015).

(4) This excludes the three decisions discussed in the "Stock promotion activities" section of this update.

(5) Matrixx Initiatives, Inc v Siracusano, 563 US 27 (2011).

(6) In re Sanofi Sec Litig, 2015 WL 365702 (SDNY January 28 2015); In re EDAP TMS SA Sec Litig, 2015 WL 5326166 (SDNY September 14 2015).

(7) In re Amarin Corp PLC, 2015 WL 3954190 (DNJ June 29 2015).

(8) Corban v Sarepta Therapeutics, Inc, 2015 WL 1505693 (D Mass March 31 2015).

(9) In re Sanofi Sec Litig, 2015 WL 365702 (SDNY January 28 2015).

(10) Jasin v VIVUS, Inc, 2015 WL 3809357 (ND Cal June 18 2015).

(11) Supra note 6.

(12) Zak v Chelsea Therapeutics Int'l, Ltd, 780 F3d 597 (4th Cir 2015).

(13) KB Partners I, LP v Pain Therapeutics, Inc, 2015 WL 3794769 (WD Tex June 16 2015).

(14) Sanders v Aveo Pharm, Inc, 2015 WL 1276824 (D Mass March 20 2015).

(15) See, for example, Brody v Transitional Hosps Corp, 280 F3d 997, 1006 (9th Cir 2002) ("Rule 10b-5 prohibits only misleading and untrue statements, not statements that are incomplete") (emphasis in original); Police Ret Sys of St Louis v Intuitive Surgical, Inc, 759 F3d 1051, 1061 (9th Cir 2014) ("We have expressly declined to require a rule of completeness"); and In re Rigel Pharm, Inc Sec Litig, 697 F3d 869, 880 n8 (9th Cir 2012). Other appellate courts have followed suit – for example, Indiana Elec Workers' Pension Trust Fund v Shaw Group, 537 F3d 527, 541 (5th Cir 2008) (allegedly "incomplete" statements are actionable only if misleading) (citing Brody); and Winer Family Trust v Queen, 503 F3d 319, 330 (3d Cir 2007) (same).

(16) Colyer v AcelRx Pharms, Inc, 2015 WL 7566809 (ND Cal November 25 2015).

(17) Battle Const Co v InVivo Therapeutics Holdings Corp, 2015 WL 1523481 (D Mass April 3 2015).

(18) For contrary results in a different regulatory setting, see BioScrip and Merck, supra note 3.

(19) Ratner v OvaScience, Inc, 2015 WL 5684068 (D Mass September 28 2015).

(20) Local No 8 IBEW Ret Plan v Vertex Pharms, Inc, 2015 WL 5749448 (D Mass September 30 2015).

(21) In re Galena Biopharma, Inc Sec Litig, 2015 WL 4643474 (D Oregon August 5 2015); In re CytRx Corp Sec Litig, 2015 WL 5031232 (CD Cal July 13 2015).

(22) In re Galectin Therapeutics Sec Litig, 2015 WL 9647524 (ND Ga December 30 2015).

(23) Lovallo v Pacira Pharms, Inc, 2015 WL 7300492 (D NJ November 18 2015).

(24) In re Ariad Pharms, Inc Sec Litig, 2015 WL 1321438 (D Mass March 24 2015).

(25) Fire & Police Pension Ass'n of Colorado v Abiomed, Inc, 778 F3d 228 (1st Cir 2015).

(26) Singer v TranS1, Inc, 2015 WL 2341907 (EDNC May 14 2015).

(27) McClain v Iradimed Corp, 2015 WL 3649461 (SD Fla May 26 2015).

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