The complaint alleges that, on August 18, 2019, the Company issued a press release announcing, “Positive Phase 3 Pooled Roxadustat Safety and Efficacy Results” and that shortly thereafter on December 23, 2019, FibroGen announced that it had submitted a New Drug Application to the Food and Drug Administration for roxadustat. The complaint further alleges that on April 6, 2021, the Company revealed that its previously disclosed safety data included undisclosed post-hoc changes to the stratification factors and did not include analyses based on the pre-specified stratification factors. As a result of these changes, the complaint alleges, FibroGen was forced to concede that roxadustat, contrary to prior representations, did not reduce the risk of cardiovascular events or hospitalization as compared to a currently approved anemia injection used as a control based on pre-specified stratification factors. On this news, the Company’s share price fell $14.90, or 43%, to close at $19.74 per share on April 7, 2021, on heavy volume. The complaint alleges that Defendants failed to disclose to investors: (i) that the Company’s prior disclosures of U.S. primary cardiovascular safety analyses from the roxadustat Phase 3 program for the treatment of anemia of CKD included post-hoc changes to the stratification factors; (ii) that FibroGen’s analyses with the pre-specified stratification factors result in higher hazard ratios (point estimates of relative risk) and 95% confidence intervals; (iii) that, based on these analyses, the Company could not conclude that roxadustat reduces the risk of (or is superior to) MACE+ in dialysis, and MACE and MACE+ in incident dialysis compared to epoetin-alfa; (iv) that, as a result, the Company faced significant uncertainty that its NDA for roxadustat as a treatment for anemia of CKD would be approved by the FDA; and (v) that, as a result of the foregoing, Defendants’ statements about the Company’s business, operations and prospects were materially misleading and/or lacked a reasonable basis.
On August 30, 2021, the United States District Court for the Northern District of California appointed Saxena White as Lead Counsel in the securities fraud class action against FibroGen, Inc.
In selecting lead counsel, Judge Edward M. Chen noted that “Saxena White has recovered hundreds of millions of dollars for plaintiffs in securities cases over the past decade,” including one of the largest shareholder derivative settlements in history and noted its “diverse makeup” as a federally certified woman- and minority-owned firm.
In his order appointing the lead plaintiffs, three sophisticated institutional investors, Judge Chen determined that the Retirement Systems’ sophistication, litigation experience, fiduciary responsibilities to their beneficiaries, and rigorous vetting process for counsel strongly imply that they “are capable of overseeing the litigation and their proposed lead counsel in an independent manner.”