Biogen is a global biopharmaceutical company that creates and manufactures drugs for diseases such as multiple sclerosis and hemophilia. Its revenues are largely dependent on the sales of TECFIDERA, a drug intended to treat multiple sclerosis.
This class action alleges that, in the first half of 2015, Biogen and some of its officers and directors misrepresented the amount of future revenue growth they expect, based largely on expected revenue growth for TECFIDERA. On January 29, 2015, in a press release and an earnings call with financial analysts, Biogen said it expected revenue growth of between 14% and 16% in 2015. In April, it held another conference call but did not change those figures.
However, in July, Biogen issued another press release revising this estimate. In fact, it reduced its expectations for growth by half, to approximately 6% to 8%. The company said that this revision was based largely on revised expectations for TECFIDERA.
At this news, the price of Biogen common stock plunged by approximately $85, a loss of more than 22%.
The class action alleges that, during the first half of 2015, officers and directors of the company had access to information that was not available to the public, and that they should therefore have known that their growth estimates were too high. It claims that they should have corrected the January statements much earlier than they did, but that the company deliberately maintained the false expectations in order to inflate the value of its stock.
What investors are part of this class action? The class period is currently defined as all persons who purchased Biogen, Inc. common stock between January 29, 2015 and July 23, 2015, inclusive (the “Class Period”). Biogen common stock trades on NASDAQ under the symbol “BIIB”
Procedural Status. The lawsuit was filed on August 18, 2015 and is captioned Tehrani v. Biogen, Inc. et al. It was filed in the Massachusetts District Court. Its civil docket number is 1:15cv13189. The lead plaintiff deadline is October 19, 2015.
This case is in the notice period. When a shareholder brings suit under certain federal securities laws, it must generally give notice of the suit via a press release. This notice starts a 60-day period during which any other shareholder can investigate the claims and choose to bring suit as well. At the end of the 60-day period, the court appoints a shareholder or a group of shareholders to be the plaintiffs for the suit. We will review the docket again in June and update this page as warranted.