Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Metzler Asset Management GMBH v. Kingsley

United States District Court, D. Massachusetts

February 1, 2017

METZLER ASSET MANAGEMENT GMBH and ERSTE-SPARINVEST KAPITALANLAGEGESELLSCHAFT MBH, on Behalf of Themselves and All Other Similarly Situated Parties, Plaintiffs,
v.
STUART “TONY” A. KINGSLEY, GEORGE A. SCANGOS, PAUL C. CLANCY, and BIOGEN, INC., Defendants.

          MEMORANDUM AND ORDER ON MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND FOR APPROVAL OF LEAD COUNSEL

          F. Dennis Saylor IV United States District Judge

         This is a putative class action involving alleged violations of the Securities Exchange Act of 1934. The Electrical Workers Pension Fund, Local 103, International Brotherhood of Electrical Workers brought suit, on behalf of a class of similarly situated persons, against Biogen, Inc., and two Biogen employees. The complaint contends that class members were harmed when they purchased Biogen securities at prices that were artificially inflated by the company's false and misleading statements about its products. This action raises issues similar to those raised in In re Biogen Inc. Securities Litigation, No. 1:15-cv-13189 (D. Mass.) (Biogen I), which this Court dismissed on June 23, 2016. See Biogen I, 2016 WL 3541538. An appeal of that action is currently pending in the First Circuit.

         Pursuant to § 21D(a)(3)(B) of the Securities Exchange Act of 1934, 15 U.S.C. § 78u-4(a)(3)(B), three putative class members (or groups)-Metzler Asset Management GmbH and Erste-Sparinvest Kapitalanlagegesellschaft mbH (“Metzler”); the City of Miami Fire Fighters' and Police Officers' Retirement Trust (“City of Miami”); and Frankfurt-Trust Investment GmbH and Frankfurt-Trust Investment Luxemburg AG (“Frankfurt-Trust”)-have each moved to be appointed as lead plaintiff and to approve of their selection of lead counsel. Frankfurt-Trust has also moved to stay this litigation pending resolution of the appeal of Biogen I.

         For the reasons set forth below, Metzler's motion will be granted, and the motions of the City of Miami and Frankfurt-Trust will be denied. Frankfurt-Trust's motion to stay will be denied without prejudice.

         I. Background

         Unless otherwise noted, all facts are stated as set forth in the complaint.

         Biogen is a biopharmaceutical company that develops therapies for neurological, autoimmune, and hematologic disorders. (Compl. ¶ 2). The company's products include prescription medicines used to treat, among other things, multiple sclerosis. (Id.). Biogen is based in Cambridge, Massachusetts. (Id. at ¶ 36).

         One of Biogen's products is the drug Tecfidera, which was approved by the Food and Drug Administration in 2013 for use in treating multiple sclerosis (“MS”). (Id. at ¶ 2). Tecfidera was the main driver of Biogen's revenues in 2014 and 2015. (Id. at ¶ 3). Biogen emphasized the importance of Tecfidera in its October 22, 2014 Form 10-Q, stating that its “current revenues depend upon continued sales of our principal products, ” including Tecfidera. (Id.).

         In the spring of 2014, the MS Institute at Shepherd Center in Atlanta, Georgia-a leading prescriber of Tecfidera in the United States-began monitoring patients taking Tecfidera for possible side effects. (Id. at ¶ 4). The Center observed that patients on Tecfidera were at an elevated risk of developing low lymphocyte counts. (Id.). Lymphoctyes are a subtype of white blood cells necessary for proper immune system functioning. (Id.).

         Between April and June of 2014, Biogen was aware that the Center was reducing its Tecfidera prescriptions. (Id. at ¶ 6). In August 2014, the medical director of the Center notified Biogen that Tecfidera was causing low lymphocyte counts among approximately 30% of its MS patients taking the drug. (Id. at ¶ 5). At that time, the Center stopped prescribing Tecfidera altogether, and made Biogen aware of its decision to do so. (Id. at ¶ 7).

         According to the complaint, Biogen did not disclose those developments regarding Tecfidera to the public, but rather continued to highlight the drug's safety and growing sales. (Id. at ¶ 8). On October 22, 2014, Biogen did publicly disclose that an MS patient who had taken Tecfidera for four and a half years had died of progressive multifocal leukoencephalopathy (“PML”), an infection caused by a virus that is dangerous for individuals with weakened immune systems. (Id. at ¶ 9). After that announcement, Biogen continued to promote the safety of Tecfidera and its increasing prescription numbers, and, in January 2015, stated that it would continue to be a major business driver for the company. (Id. at ¶¶ 10, 14).

         On April 24, 2015, Biogen disclosed that the PML death was having some effect on Tecfidera sales, stating that new patients were being put on the drug at a slower rate than before. (Id. ¶ 17). The next month, it stated that fallout from the PML death was contained, and that doctors' beliefs about the safety of the drug were back to where they had been before the PML death. (Id. ¶ 19).

         On July 24, 2015, Biogen announced that it was cutting its revenue guidance in half, “based largely on revised expectations for the growth of Tecfidera.” (Id. at ¶ 26). Biogen's stock price, which had closed at $385.05 per share on July 23, 2015, closed at $300.03 per share on July 24. (Id. at ¶ 26).

         On October 20, 2016, the Electrical Workers Pension Fund, Local 103, International Brotherhood of Electrical Workers filed a complaint on behalf of all purchasers of Biogen's publicly traded securities between July 23, 2014, and July 23, 2015. The complaint contends that Biogen and the individual defendants violated federal ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.