Rinvoq Lawsuit Filed Against AbbVie By Investors Over Failure to Disclose Safety Concerns
AbbVie faces a class action lawsuit over Rinvoq, alleging that the drug maker failed to warn investors about safety concerns associated with the rheumatoid arthritis drug, which ultimately required an FDA label warning and more restricted use, which harmed the company’s stock value.
The Rinvoq lawsuit (PDF) was filed by Calvin T. Nakata in the U.S. District Court for the Northern District of Illinois on April 6, pursuing claims against AbbVie, Inc., as well as the drug maker’s Chief Executive Officer, Chief Financial Officer, Chief Commercial Officer and Vice Chairman as defendants.
Rinvoq (upadacitinib) was approved by the FDA in August 2019, for the treatment of moderate-to-severe rheumatoid arthritis and joined a lucrative group of treatments that generate billions in annual sales, such as Humira, Remicade and Enbrel. The drug is part of a new class of medications known as a Janus kinase (JAK) inhibitor, which also includes Xeljanz, and quickly grew to become a blockbuster treatment after it was introduced in 2012.
JAK inhibitors work by blocking the activity of certain enzymes in the body that affect the immune system function and inflammatory response. However, there are now increasing concerns about the potential side effects of the drugs, and a number of formers users are now pursuing Xeljanx lawsuits against the manufacturer of that drug for failing to adequately warn that users may develop cancer, heart problems, blood clots or other injuries.
Learn More About Xeljanz lawsuits
Side effects of Xeljanz linked to risk of cancer, heart attacks, pulmonary embolism, deep vein thrombosis, blood clots and death.
In December, AbbVie announced it was updating the Rinvoq warning label, adding new information about the risk of heart attacks, strokes, cancer, blood clots and death, which were identified in post-marketing studies recently conducted for Xeljanz.
The Rinvoq lawsuit accuses AbbVie of making false and misleading statements to investors prior to that warning update, and failing to disclose that safety concerns over Xeljanz, which were announced by the FDA months before the Rinvoq label change, would also affect the competing AbbVie drug.
“Specifically, Defendants misrepresented and/or failed to disclose that: (1) safety concerns about Xeljanz extended to Rinvoq and other JAK inhibitors; (2) as a result, it was likely that the FDA would require additional safety warnings for Rinvoq and would delay the approval of additional treatment indications for Rinvoq; and (3) therefore, Defendants’ statements about the Company’s business, operations, and prospects lacked a reasonable basis,” Nakata’s lawsuit states. “As a result of Defendants’ wrongful acts and omissions, and the significant decline in the market value of the Company’s securities when the truth was revealed, Plaintiff and other members of the Class have suffered significant damages.”
Nakata’s lawsuit claims that during an investor call in April 30, 2021, when AbbVie was announcing its first quarter 2021 financial results, investors were told the problems were being perceived as a Xeljanz issue only. Similar statements were made by AbbVie executives, who are named as defendants in the lawsuit, throughout the year, according to the complaint.
However, in a drug safety communication issued in September, the U.S. Food and Drug Association (FDA) announced that a Xeljanz warning label update, after data from a large randomized clinical trial suggested that users were more likely to experience serious heart problems and cancer compared to older rheumatoid arthritis drugs. The FDA indicated those concerns had spread to other JAK inhibitors as well, including Rinvoq and Olumiant.
As a result, the AbbVie’s common stock price dropped $8.51 per share, more than 7%. The lawsuit presents claims defendants violated the Exchange Act and Security Exchange Commission rules.
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