The Complaint charges that the Company and its Chief Executive Officer, President and Chairman of the Board violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10-b(5). The action alleges that defendants issued a series of false and misleading statements concerning its Mitozytrex, also known as MitoExtra, drug and the drug's ability to treat cancer.
Specifically, the Complaint charges that defendants repeatedly issued press releases claiming Mitozytex was a new drug available to treat gastric and pancreatic cancers, when, in fact, the drug was nothing more than an injectable form of the already existing drug mitomycin. Moreover, the Complaint alleges that defendants purposefully did not inform the public of the significant risks associated with use of Mitozytex, including but not limited to fever, anorexia, nausea, vomiting, myelosuppression and hemolytic uremic syndrome. As a result of these false and misleading statements, defendants were able to sell millions of shares of SuperGen stock and notes for proceeds of $25 million, thereby profiting from the artificial inflation in SuperGen's stock price. The Complaint charges that as a result of defendants' actions, plaintiff and the Class were damaged.
The Complaint alleges that during the Class Period plaintiff and the rest of the Class purchased Supergen securities at prices artificially inflated as a result of defendants' false and misleading reports.