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I frequently received requests or questions relating to the increased risk of securities litigation that life sciences companies face. I have reviewed these issues in my own analysis of securities litigation filing trends (for example, refer here) as well as in my discussion of others’ analyses (for example, here). In another recent report, the Sidley Austin law firm has taken a detailed look at important securities litigation developments in 2018 relating to life sciences companies. This latest report includes not only a review of life sciences companies’ securities litigation class action filings trends but also takes a look at the life sciences companies’ track record in the courts, on motions to dismiss in the district courts and on appeal. The court ruling analysis suggests a number of important implications for life sciences companies’ disclosure practices. The law firm’s report, entitled “Securities Class Actions in the Life Sciences Sector: 2018 Annual Survey” can be found here. The law firm’s two-page report summary can be found here.
Continue Reading A Closer Look at 2018 Securities Litigation Against Life Sciences Companies

As I have previously noted, 2018 was another extraordinary year for U.S. securities class action litigation, as filings overall remained at near-historical rates. One of the significant contribution factors to this development was the substantial number of securities suits filed against life sciences companies. The number and significance of the securities suits filed against life sciences companies is detailed in a February  6, 2019 report from the Dechert law firm entitled “Dechert Survey: Developments in U.S. Securities Fraud Class Actions Against Life Sciences Companies: 2018 Edition” (here).
Continue Reading A Detailed Look at 2018 Securities Litigation Against Life Sciences Companies

  1. As I have previously noted, the elevated number of securities class action lawsuits against life sciences companies was an important factor in the increase of securities lawsuit filings in 2017. The significant volume of securities suits involving life sciences companies has been the subject of focused analysis, as discussed here. Now the Sidley Austin law firm has released its exhaustive review of the 2017 securities litigation against life sciences companies. Among other things, the report finds that while the numbers of securities suit filings against life sciences companies has increased in recent years, the companies are faring worse at the dismissal motion stage in the district courts relative to the most recent years. The report summary can be found here. The full report can be found here.
    Continue Reading Another Look at 2017 Securities Litigation Against Life Sciences Companies

In general, securities litigation filing trends emerge gradually and across long stretches of time. These kinds of long term trends have been the subject of a number of recent reports discussed on this site – including, for example, recent reports from NERA Economic Consulting (about which refer here), Cornerstone Research (here), as well as my own report. Though trends often become apparent only over the course of months and years, sometimes they are apparent in much shorter time frames. As it happens, the securities suit filings on a single day last week managed to neatly encapsulate all of the important current securities litigation filing trends.
Continue Reading The Sum of All Securities Litigation Filing Trends

As has been well-documented on this site, 2017 was an extraordinary year for securities class action lawsuit filings, with a record number of new lawsuits filed at a record rate. Among the important contributing factors to the significant volume of securities suit filings during the year was the volume of lawsuits filed against life sciences companies. The significance of the litigation activity against biopharma companies, a subset of the overall life sciences sector, was the subject of a detailed and precise analysis in a guest post earlier this week.

There is still the question of the meaning of large volume of litigation involving life sciences companies generally.  According to the latest annual analysis from the Dechert law firm, the number of securities lawsuits filed against life sciences companies in 2017 increased 30% from the previous year, and increased more than 225% from only five years earlier. The law firm’s February 8, 2018 report entitled “Developments in Securities Fraud Class Actions Against U.S. Life Sciences Companies: 2017 Edition” can be found here.
Continue Reading A Detailed Look at 2017 Securities Litigation Involving Life Sciences Companies

test tubesAs has been documented on this blog and elsewhere, life sciences companies in general, and developmental stage biotechnology companies in particular, are frequent securities class action litigation targets. But does that really justify the perception of early stage biotech companies as representing a heightened securities litigation risk class for D&O insurers? A recent law firm paper contends that “contrary to popular belief, development stage biotech companies actually have less to fear from federal securities cases that do many other types of corporate defendants that have a far easier time securing insurance coverage.”
Continue Reading Biotech Companies Sued Frequently But Do They Really Represent a Heightened Risk Class?

life sciences1As I noted in my survey of 2016 securities class action litigation (here), one of the factors contributing to the rise in securities litigation last year was the volume of litigation filed against companies in the life sciences sector. According to an analysis of life sciences-related securities suits by the Dechert law firm, the annual number of securities suits filed against companies in the sector rose by over 70% between 2014 and 2016. The law firm’s February 17, 2017 report, entitled “Developments in Securities Fraud Class Actions Against U.S. Life Sciences Companies,” can be found here.
Continue Reading A Closer Look at Securities Litigation Involving Life Sciences Companies

lifesciencesLife sciences companies are among the most frequent targets of securities class action litigation as I noted in a recent post. However, according to a recent law firm report, life sciences company defendants fared well in securities litigation in 2015. The recently released report, written by the Sidley Austin law firm and entitled “Securities Class Actions in the Life Sciences Sector: 2015 Annual Survey,” can be found here. This comprehensive report reviews all of the district court and appellate court decisions in 2015 in securities class action lawsuits pending against life sciences companies, and also reviews the new securities suits that were filed in 2015 against life sciences companies. The report provides a broad overview of the important issues involved with securities class against litigation against life sciences companies.
Continue Reading Securities Litigation and Life Sciences Companies: An Update

lifesciencesIn 2015, as was the case for several years prior, companies in the life sciences sector experienced a disproportionately greater number of securities class action lawsuits than companies in other industries. As I detailed in my analysis of 2015 securities class action lawsuit filings (here), 39 of the 191 securities class action lawsuits filed in 2015 involved companies in the life sciences sector, representing about one in five of all securities suit filings during the year. No other sector experienced anywhere near this number of securities class action lawsuit flings. For example, the sector with the second-most number of filings, software companies, had eleven filings during 2015, representing about 6% of securities suit filings during the year.

There are a number of reasons why there are more securities suit filings involving life sciences companies, as discussed below. The frequency and severity of lawsuits against companies in the life sciences sector have important D&O Insurance implications as well, as also discussed below.
Continue Reading Securities Suit Frequency Means Challenging D&O Insurance Market for Life Sciences Companies

lifesciencesLife sciences companies are “an increasingly popular target” of securities class action lawsuits, according to the annual securities litigation survey from the David A. Kotler of the Dechert law firm. According to the March 16, 2015 report, entitled “Dechert Survery of Securities Fraud Class Actions Brought Against U.S. Life Sciences Companies,” the number of 2014…