SAN DIEGO and MENLO PARK, Calif., March 24, 2014 /PRNewswire/ -- Shareholder rights law firm Robbins Arroyo LLP announces that an investor of Geron Corporation (NASDQ: GERN) has filed a federal securities fraud class action complaint in the U.S. District Court for the Northern District of California. The complaint alleges that the company and certain of its officers and directors violated the Securities and Exchange Act of 1934 between June 16, 2013 and March 11, 2014 (the "Class Period"). Geron is a clinical stage biopharmaceutical company developing a telomerase inhibitor, imetelstat, in hematologic myeloid malignanciesis.
Geron Accused of Failing to Disclose Risks Associated with Imetelstat
According to the complaint, shares of Geron fell $2.71 or nearly 61%, to close at $1.69 per share on March 12, 2014, following an announcement by the company that it received notice from the U.S. Food and Drug Administration that its Investigational New Drug application for Imetelstat had been placed on full clinical hold. According to the press release, the FDA's notice resulted from "the occurrence of persistent low-grade liver function test (LFT) abnormalities observed in the Phase 2 study of imetelstat in ET/PV patients and the potential risk of chronic liver injury following long-term exposure to imetelstat." Geron received news of the full clinical hold in the form of a verbal notice from the FDA, which affects all active company-sponsored clinical trials.
The complaint further alleges that Geron failed to disclose to investors the persistent LFT abnormalities observed in the Phase 2 study and the potential risk of chronic liver injury associated with long-term exposure to imetelstat. As a result, Geron statements regarding financial performance were materially false and misleading throughout the Class Period.