Boston, MA 04/23/2014 (wallstreetpr) – Geron Corporation (NASDAQ:GERN) is being accused of knowingly or unknowingly misleading its investors according to a filing by one of the company’s investors. The allegations claim the company and a number of its officers, as well as directors, could have violated the Securities and Exchange Act of 1934 with questionable remarks concerning the drug imetelstat. The misdealing’s according to the filling took place between June 16, 2013 and March 11, 2014.
Imetelstat Put on hold
According to the filling, the company’s shares fell by as much as 61% or $2.71 as of the close of business on March 12, 2014 to close the day at a low of $1.69. The drop in the market was as a result of the Food Drugs and Administration putting on hold full clinical trial for imetelstat.
The move by the FDA to put a hold on full clinical trial of the drug was as a result of it being the cause of persistent low grade liver function test LFT as observed in phase 2 study, in patients. Geron received the news via word of mouth technically affecting all its active sponsored clinical trials.
The filed complaint also alleges that Geron Corporation (NASDAQ:GERN) failed to disclose to investors the persistent abnormalities that were caused by the drug. The drug has been cited as a possible cause of chronic liver injury associated with its long term exposure. The complaints maintain the company’s statement was consequently materially misleading and false.
Class Action started
Law firm Lieff Cabraser Hermann & Bernstein, LLP, has kick started class action litigation against Geron on behalf of the company’s shareholders who bought shares between June 16, 2013 and March 11, 2014. Imetelstat is the company’s sole product candidate and has been developed to prevent cancer cell replication in myeloid malignancies. Despite the ongoing legal tussles, Geron stock continues to surge in the market. Geron Corporation (NASDAQ:GERN)’s stock was up by 14.66% on Tuesday trading session.
