Alzheimer’s, with its loss of the most basic kinds of mental functioning, is a frightening disease. Unfortunately, the complaint for this class action claims that Neurotrope, Inc. in its public statements in 2017 over-promised for its new drug Bryostatin-1 and its alleged ability to repair brain synapses.
The class for this action is all persons who acquired Neurotrope common stock between January 7, 2016 and April 28, 2017.
Neurotrope is a clinical-stage biopharmaceutical company that specializes in treatments of neurodegenerative diseases, including Alzheimer’s. During the class period, its most advanced product in treating Alzheimer’s was Bryostatin, a drug that was purported to repair damaged synapses between neurons and prevent neuronal death.
On January 7, 2016, Neurotrope issued a press release saying it was proceeding to Phase 2b trials of Bryostation, after successful Phase 1 and Phase 2a trials. The company said, “We believe that Bryostatin represents a potential breakthrough in the treatment of this debilitating disease…” An announcement a month later touted it as “a new and disruptive technology in what has been an unsuccessful war against Alzheimer’s disease….”
In November of that same year, a Neurotrope press release announced that it had completed enrollment for its first Phase 2b trial, saying, “We believe we may have a breakthrough in Alzheimer’s disease and other neurological disorders.”
Similarly optimistic pronouncements followed in other public statements, including a statement from the company’s CEO saying that the company’s data “leads us to believe that our mechanism of action can be very effective in reversing Alzheimer’s disease”—as opposed to simply delaying its progress.
On May 1, 2017, Neurotrope issued a press release announcing “positive top-line results from its Phase 2 study … of Bryostatin-1 in patients with moderate to severe Alzheimer’s disease…” The study included giving patients 20 and 40 microgram doses of the drug against a placebo.
Although the company presented the results as positive, the complaint claims that results for the 20 microgram dose did not show statistical significance in the effectiveness, and that results of the 40 microgram doses were deliberately omitted. Neurotrope’s stock lost 63% of its value at the news.
According to the complaint, the company acted with scienter, over-promising on the drug and attempting to hide negative information. The complaint claims that Neurotrope’s statements during the class period are therefore violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.