HAVERFORD, Pa., May 16 /PRNewswire/ -- Chimicles & Tikellis LLP and Durant & Durant, LLP have commenced a securities class action against Discovery Laboratories, Inc. (“Discovery Labs” or the “Company”), Robert J. Capetola, its Chief Executive Officer, and Christopher J. Schaber, its former Chief Operating Officer, in the United States District Court for the Eastern District of Pennsylvania. The action, DePace v. Discovery Laboratories, Inc., No. 06-02045(SD), was brought on behalf of all persons who purchased common stock of Discovery Labs between February 1, 2005 and April 24, 2006 (the “Class”). Excluded from the Class are defendants, members of their families, and the directors and officers of Discovery Labs and its subsidiaries.
Discovery Labs is a development stage biotechnology company, which is focused upon proprietary surfactant technology. Surfactants are produced naturally in the lungs and are essential for breathing. The Company’s technology is intended to produce a precision-engineered surfactant that is designed to closely mimic the essential properties of natural human lung surfactant; this technology is intended for use as surfactant replacement therapies for respiratory diseases. The Company’s lead product, Surfaxin(R) (lucinactant) was undergoing review by the FDA as part of a new drug application as a potential treatment to prevent respiratory distress syndrome in infants. Surfaxin(R) was also under review by the European Medicines Evaluation Agency for approval in Europe.
The amended complaint in the action alleges claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 against Discovery Labs, Capetola and Schaber. Specifically, the complaint alleges that the defendants issued a series of press releases and SEC filings that were false and misleading because they falsely portrayed the Company’s capacity to manufacture Surfaxin(R) in compliance with the FDA’s current Good Manufacturing Requirements, a requirement had to be met before the FDA would grant approval to that product. Throughout the Class Period, the defendants’ public statements indicated that they expected that approval of the new drug application for Surfaxin(R) would occur in the near future. Instead, on April 24, 2006, the Company announced that it faced the potential of a significant delay in the approval process for Surfaxin(R) because process validation batches manufactured for its NDA had not met required stability criteria. Stability relates to the ability of a pharmaceutical product to be stored without degradation. Discovery Labs’ common stock swiftly reacted, closing substantially lower on April 25, 2006 on very high volume. A copy of the amended complaint filed in this action is available from the Court, and it can also be viewed at http://www.chimicles.com.
If you are a member of the Class, then you may move the Court to serve as lead plaintiff of the Class on or before June 30, 2006, based upon a prior notice issued in connection with another class action filed against Discovery Labs. Because the class period covered by the amended complaint in this action is longer, it is possible that the Court will consider a motion for appointment as lead plaintiff filed after June 30, 2006, however, there is no assurance that it will do so.
If you would like to consider serving as a lead plaintiff or have any questions about this class action, please contact James R. Malone, Jr. (jamesmalone@chimicles.com) or Joseph G. Sauder (josephsauder@chimicles.com) by email or by phone at 1-888-805-7848.
Chimicles & Tikellis LLP is a leading class action law firm with a national practice and with significant experience representing investors in class actions under the federal securities laws. Please go to our web site if you would like more information about our firm. http://www.chimicles.com.
Chimicles & Tikellis LLP
CONTACT: James R. Malone, Jr., jamesmalone@chimicles.com, or Joseph G.Sauder, josephsauder@chimicles.com, both of Chimicles & Tikellis,+1-888-805-7848
Web site: http://www.chimicles.com/
