On May 4, 2021, the U.S. Food and Drug Administration released a “Briefing Document” concerning ChemoCentryx, Inc. (“ChemoCentryx” or the “Company”) and its drug candidate avacopan, which is in development for the treatment of adult patients with anti-neutrophil cytoplasmic autoantibody (ANCA) vasculitis. To support its New Drug Application for avacopan, ChemoCentryx relied primarily upon its Phase III ADVOCATE trial. In the Briefing Document, the FDA wrote that “[c]omplexities of the study design . . . raise questions about the interpretability of the data to define a clinically meaningful benefit of avacopan and its role in the management of” ANCA vasculitis. The FDA further wrote that it had “identified several areas of concern, raising uncertainty about the interpretability of the data and the clinical meaningfulness of these results . . . .”
On this news, shares of ChemoCentryx stock fell approximately 45% in one day, after plummeting by over 60% during intraday trading on May 4, 2021.
The Complaint alleges that Defendants failed to disclose to investors that: (i) the study design of the Phase III ADVOCATE trial presented issues about the interpretability of the trial data to define a clinically meaningful benefit of avacopan and its role in the management of ANCA-associated vasculitis; (ii) the data from the Phase III ADVOCATE trial raised serious safety concerns for avacopan; (iii) these issues presented a substantial concern regarding the viability of ChemoCentryx’s NDA for avacopan for the treatment of ANCA associated vasculitis; and (iv) as a result of the foregoing, Defendants’ public statements were materially false and misleading at all relevant times.
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