On September 8, 2023, Judge John M. Vazquez of the U.S. District Court for the District of New Jersey issued an order in In re Celgene Corp. Securities Litigation, No. 2:18-cv-04772, denying in large part Defendants’ motion for summary judgment. This securities fraud case involves Celgene’s alleged misrepresentations and omissions regarding two of its drugs, Otezla and Ozanimod. The Court previously certified a class of investors who purchased Celgene common stock between April 27, 2017 and April 27, 2018.
Celgene launched Otezla, a drug approved for the treatment of psoriasis and psoriatic arthritis, in 2014. Celgene primed the market that Otezla sales were poised to sky-rocket, representing that Otezla net sales would reach $1.5 billion to $2 billion by 2017, despite receiving explicit internal warnings that the 2017 projection was unattainable. Investors allege that in April and July 2017, Defendant Terrie Curran, Celgene’s President of Inflammation & Immunology, made false statements to investors regarding the success of Otezla. On October 26, 2017, Celgene reduced its 2017 Otezla sales guidance by $250 million, leading to significant shareholder losses.
The case also involves Celgene’s development of Ozanimod, a multiple sclerosis drug. The class alleges that between April 2017 and February 2018, Defendants issued numerous false or misleading statements touting the filing of Celgene’s New Drug Application (“NDA”) for Ozanimod with the U.S. Food and Drug Administration (“FDA”) by the end of 2017, while failing to disclose the discovery of a new metabolite that threatened to derail the NDA. On February 27, 2018, Celgene disclosed that the FDA had refused to file the Ozanimod NDA, again leading to massive market losses.
Following oral argument, on September 8, 2023, Judge Vazquez found that genuine disputes of material fact exist with regard to the Otezla statements, denying Defendants’ motion in its entirety with respect to these statements. The Court also found genuine disputes of material fact with regard to Defendant Philippe Martin’s October 28, 2017 statement related to the Ozanimod NDA, and denied Defendants’ motion with respect claims based on this statement.
Judge Vazquez has since retired from the bench and the case will be transferred to a new presiding judge for trial.
The Kessler Topaz team representing the investor class on the summary judgment motion included Andrew Zivitz, Matthew Mustokoff, Joshua D’Ancona, Margaret Mazzeo, Nathan Hasiuk, Vanessa Milan, and Nathaniel Simon.