This is a securities fraud class action against Northfield Laboratories.
On February 22, 2006, a story in The Wall Street Journal reported that the data available to Northfield from the ANH clinical trial, but not to the public, revealed that ten of 81 patients who received PolyHeme suffered a heart attack within seven days, and two of those died. The data further showed Northfield that none of the 71 patients in the ANH clinical trial who received real blood were found to have suffered a heart attack. In the aftermath of receiving this data, Northfield shut down the ANH clinical study in 2000 and kept this highly adverse data hidden from the public view.
Northfield in a press release on February 22, 2006, responding to The Wall Street Journal article, did not dispute the data concerning the patient heart attacks and deaths from the ANH clinical trial. Rather, Northfield admited that they did not publish the data concerning patient heart attacks and deaths, and one executive of Northfield stated in the press release that "(w)e believe that publishing the full data upon closing the study, would have shown that PolyHeme could not be isolated as the cause of the observed serious adverse events."
The complaint charges Northfield Laboratories, Inc. and its Chairman and CEO, with violations of the Securities Exchange Act of 1934 and Securities Act of 1933. The class action security fraud lawsuit further alleges that the market was stunned by the disclosure of the secret, adverse data from the long-closed ANH clinical trial and the market price of Northfield's common stock fell with the belated disclosures.
On February 21, 2006, the day before the disclosure by The Wall Street Journal, Northfield's common stock closed at a price of $12.23 per share. On February 22, 2006, on extraordinary volume of more that 4.1 million shares, Northfield's common stock closed at a price of $11.64 per share. The price continued to drop as the market absorbed all of the news, including the announcement on February 24, 2006, by United States Senator Charles E. Grassley, Chairman of the U.S. Senate Finance Committee, that he has begun an inquiry into the matter.
Name (Stock Symbol)
Northfield Laboratories, Inc. (NFLD)
Northfield Laboratories, Inc. is a biotech company.
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