Ontario Superior Court of Justice, Court File No.: 17-CV-573962
For more information about this action, or to obtain a copy of the most recent statement of claim, please contact the Firm at firstname.lastname@example.org.
This securities class action relates to the Defendants publishing core and other documents about Endo International plc’s (“Endo”) generic pharmaceutical business containing both affirmative misrepresentations and misrepresentations by omission.
During December of 2015, Endo received a subpoena from the Office of the Attorney General for the State of Connecticut requesting documents relating to its marketing, pricing, and communications with competitors about certain of its drugs (the “Connecticut Investigation”). Simultaneously, Endo began observing increased aggressive pricing by competitors and loss of business in its generic pharmaceutical business. Despite the fact that Endo was required by applicable securities law to disclose any known trends that would likely have an effect on revenues and earnings such as aggressive competitive pricing and erosion in its main business segment and despite the fact that Endo disclosed an earlier investigation by the U.S. District Court for the Eastern District of Pennsylvania into pricing of the same generic drugs, the Defendants chose not to disclose the Connecticut Investigation in Endo’s next interim filings, as the Plaintiff alleges they were legally required to do. Rather, throughout all of the first quarter of the 2016 fiscal year, the Defendants touted the strength of Endo’s generic pharmaceuticals business and represented that 2016 total revenues would be between $4.32 and $4.52 billion with adjusted diluted earnings per share (“EPS”) of $5.85 to $6.20 and an expected gross margin of 63% to 65%.
After repeating the aforementioned representations numerous times during the Class Period, on May 5, 2016 Endo suddenly revealed that its generic pharmaceutical business had experienced “more significant than expected erosion” due to aggressive pricing by competitors and consequently Endo was cutting its expected 2016 revenue by approximately $500 million to between $3.87-$4.03 billion, reducing its adjusted diluted EPS by roughly 23% to $4.50-$4.80 and reducing its expected gross margin to 59%-60%. Endo further disclosed on May 6, 2016, or more than 5 months after it became aware of the fact, that it was under investigation since December 2016 by the Attorney General for the State of Connecticut for violating antitrust laws relating to certain of its general pharmaceutical products. Upon release of this news, Endo’s securities on the Toronto Stock Exchange lost nearly 42% of their value in just two trading-days, thereby causing substantial damages to the Class Members.
Claim Issued: April 25, 2017
Class Period: January 11, 2016 to and including May 5, 2016
Shareholders’ Canadian Counsel: Andrew Morganti & Eli Karp, Morganti Legal
Shareholders’ U.S. Counsel: Samuel H. Rudman, Robbins Geller Rudman & Dowd LLP
Shareholders’ Economist: Andrew M. Mintzer, Hemming Morse LLP
Defendants’ Canadian Counsel: Matthew Milne-Smith, Davies Ward Phillips & Vineberg LLP
Defendants’ U.S. Counsel: James Ellis Brandt, Latham & Watkins LLP