A class action lawsuit has been filed against Inovio Pharmaceuticals Inc. by investors who claim that the company misled them and the public by claiming to have developed a coronavirus vaccine.
Plaintiff Patrick McDermid says the CEO of Inovio, J. Joseph Kim, claimed on national television that his company had developed a vaccine for the coronavirus.
The plaintiff alleges that on Feb. 14, Kim appeared on Fox News with Neal Cavuto and stated that Inovio had developed a coronavirus vaccine “in a matter of about three hours once we had the DNA sequence from the virus” and had assured viewers that “our goal is to start phase one human testing in the U.S. early this summer.”
After Kim made these statements, Inovio’s stock rose 10 percent over the next few days, according to the Inovio class action lawsuit.
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The Inovio class action lawsuit maintains that on Feb. 20, Dr. David Weiner of the Wistar Institute discussed in an interview with The Scientist that steps were being taken to create a vaccine for the coronavirus. Dr. Weiner reportedly stated that his company was working with Inovio on a coronavirus vaccine.
McDermid says two weeks later, on March 2, Kim met with President Trump and claimed “we were able to fully construct our vaccine within three hours […] Our plan is to start [U.S. based COVID-19 trials] in April of this year.”
In addition, in an 8-K filing on March 9, Inovio allegedly stated that it believed that it was in a position to begin human clinical trials in the United States by April 2020 and soon thereafter in China and South Korea.
After making those statements, Inovio’s stock quadrupled and continued to soar during the following weeks, reaching $19.36 by March 9, the plaintiff alleges.
McDermid claims that, during the hype surrounding Inovio, the company entered into an agreement to sell $50 million of its stock on the open market starting on March 9.
However, according to McDermid, Inovio had not developed a coronavirus vaccine. He claims that on March 9, a company called Citron Research exposed the false statements made by Kim and called for an SEC investigation of Inovio.
Inovio’s stock then dropped, but Kim allegedly tried to blunt the pain by admitting that his company did not develop a coronavirus vaccine, but had “designed a vaccine construct” and believed that it had a “viable approach to address the COVID-19 outbreak,” according to the class action lawsuit.
McDermid states that the defendant falsely described their product as a fully completed coronavirus cure, but was nothing of the sort. The defendants’ claims that they had developed a coronavirus vaccine in a matter of three hours is scientifically impossible, the Inovio class action lawsuit adds.
The plaintiff argues that Inovio also falsely claimed that they would be able to start human trials in April 2020 when they do not have regulatory authority to make that decision.
“Given the heightened anxiety surrounding this pandemic and the desperate demand for an effective COVID-19 vaccine, Defendants knew and were deliberately reckless as to the falsity of their claims,” McDermid argues.
The defendants knew or should have known that their statements about developing a vaccine for the coronavirus were not true, that a vaccine could not have been developed in a matter of hours, and that trials would not begin in April 2020.
The plaintiff contends that the defendant has violated the Securities Exchange Act by 1) employing devices, schemes, and artifices to defraud, 2) making untrue statements or omitting material facts which would make a statement misleading, and 3) engaging in acts which operated as a fraud and deceit on those who purchased stocks during the class period.
McDermid claims that he and the other Class Members were harmed because they paid artificially inflated prices for the Inovio stock. He states that he and other Class Members would not have purchased Inovio’s common stock if they knew that the market prices had been artificially inflated by Kim’s misleading statements.
Prospective Class Members include: “All persons and entities who purchased or otherwise acquired Inovio common stock between February 14, 2020 and March 9, 2020, inclusive. Excluded from the Class are Defendants, directors and officers of the Company, as well as their families and affiliates.”
The plaintiff is represented by Shanon J. Carson, Michael C. Dell’Angelo and Andrew D. Abramowitz of Berger Montague and Jeffrey C. Block, Jacob A. Walker and Mark A. Delaney of Block & Leviton LLP.
The Inovio Coronavirus Cure Class Action Lawsuit is McDermid v. Inovio Pharmaceuticals, et al., Case No. 2:20-cv-01402, in the U.S. District Court for the Eastern District of Pennsylvania.
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13 thoughts onInovio Sued Over False Coronavirus Vaccine Claims
Please add me to this class action. Sue them and look at criminal charges. You should not be able to make these false claims over something so huge, cause confusion, gain money, and money people lost on falsehoods was large
Please add me to the list
Add me please