Patterson, PA: (Sep-10-07) Two securities class action lawsuits were brought against Sepracor Inc., a Massachusetts-based pharmaceutical company, alleging that it concealed safety concerns surrounding its new antihistamine candidate, Soltara, that was rejected by the FDA for marketing approval in March 2002.
In a settlement reached, Judge Morris Lasker of the US District Court for the District of Massachusetts granted final approval of a $52.5 million settlement, resolving the class actions. Sources claim that the settlement is the third-largest settlement in a securities fraud case against a bio-technology company concerning a drug approval. The suit was maintained by Staro Asset Management, LLC on behalf of a debt class consisting of holders of Sepracor's convertible debt securities, and by Westmont Venture Partners, LLC on behalf of an equity class consisting of holders of Sepracor's common stock, call options and put options. If the suit had gone to trial, experts say that there would have been a battle of conflicting medical and scientific experts given the multitude of complex scientific issues surrounding the development of Sepracor's new drug candidate. Additionally, economic experts would have quarreled about the proper measure of damages to the two classes caused by Sepracor's failure to obtain approval for its highly touted antihistamine drug. [
