Failed CheckMate-026 Lung Cancer Trial Comes Up in Securities Complaint Against Bristol-Myers Squibb

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A proposed class action lawsuit has been filed in California on behalf of anyone who acquired securities for defendant Bristol-Myers Squibb Company between January 27, 2015 and October 9, 2016 (the class period).

The lawsuit, which also names six of Bristol-Myers’ top executives as defendants, centers on the company’s CheckMate-026 trial study that investigated the use of Opdivo monotherapy as first-line therapy for patients with non-small cell lung cancer. According to the complaint, Bristol-Myers on August 5, 2016, announced the CheckMate-026 trial had failed, as it did not hit its “primary endpoint of progression-free survival.” When this news became public, Bristol-Myers’ stock price sunk $12.04 per share, the case says, and continued to fall another $2.98 per share on the next trading day.

Upon disclosing its final primary analysis of CheckMate-026 in October 2016—including the finding that “overall survival was only 14.4 months for Opdivo versus 13.2 months for chemotherapy”—Bristol-Myers’ stock prices fell again, to $5.62 per share. The lawsuit alleges that throughout the class period, the defendants put forth materially false and/or misleading statements while failing to disclose that:

• CheckMate-026 was “more likely to fail” than the company was representing; and
• CheckMate-026 failed more severely than Bristol-Myers let on in its August 5, 2016 announcement and disclosures.