Pharmaceutical Company AcelRx Misled Investors, the Public About Pain Medication, Class Action Alleges

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Pharmaceutical company AcelRx and its executives made false statements about the company’s business and signature product DSUVIA harming investors, a new class action lawsuit alleges.

The nationwide class action lawsuit was filed in California on June 8 by lead Plaintiff Aaron Sneed Jr. who alleges that AcelRx and its CEO and CFO violated the Securities Exchange Act by making false and misleading statements to investors about the business, operations, and compliance policies.

According to the claim, the company and executives failed to disclose that AcelRx had deficient disclosure controls and procedures with respect to its marketing of DSUVIA, and, as a result, AcelRx had been making false or misleading claims and representations about the risks and efficacy of DSUVIA in certain advertisements and displays.

“The foregoing conduct subjected the Company to increased regulatory scrutiny and enforcement; and as a result, the Company’s public statements were materially false and misleading at all relevant times,” the claim states.

AcelRx is a specialty pharmaceutical company that develops and sells medications for the treatment of acute pain, according to the class action lawsuit. DSUVIA, a 30 mcg sufentanil sublingual tablet for the treatment of moderate-to-severe acute pain, is the company’s primary product.

In 2018, AcelRx announced that the U.S. Food and Drug Administration (FDA) had approved DSUVIA for the management of acute pain in certain adults. Between 2020 and 2021, the company released a number of statements to investors and the public stating that AcelRx had utilized a scientific support team; increased awareness of the clinical profile of sublingual administration of sufentanil; engaged appropriate Advisory Boards on appropriate commercial positioning for DSUVIA; built a sales and marketing organization; and established DSUVIA on hospital and ambulatory surgery center formularies.

However, the claim states that the statements made by the company and executives were materially false and misleading and they failed to disclose material adverse facts about the AcelRx’s business, operations, and compliance policies.

In February, 2021, AcelRx disclosed told investors that it had received a warning letter from the FDA concerning promotional claims for DSUVIA.

According to the letter from the FDA, a banner marketing DSUVIA should have included the words “Do not exceed 12 tablets in 24 hours.” By omitting “this material information” about the maximum daily dosage, the banner creates a misleading impression about the safe use of DSUVIA, the letter read.

“The FDA noted that ‘these omissions are concerning from a public health perspective due to the serious risks associated with overdose with DSUVIA, including respiratory depression and death, that should be considered when prescribing the product.”

On the news of the FDA’s letter, AcelRx’s stock price fell $0.21 per share, or 8.37 percent, according to the claim, causing investors such as Sneed Jr. to lose money.

Sneed Jr. wants to represent any AcelRx stockholders in the U.S. who were damaged by the company’s alleged misleading statements. He is suing for violations of the Securities Exchange Act and seeks certification of the Class, damages, interest, legal fees and costs, and a jury trial.

Recently, real estate investment trust Washington Prime Group, Inc. was hit with a class action lawsuit for allegedly making positive statements about its business operations when its financial condition was deteriorating rapidly. 

Has a company ever misrepresented itself to you as a shareholder and caused you to lose money? Let us know in the comments section!

Sneed Jr. is represented by Jennifer Pafiti, Jeremy A. Lieberman, and J. Alexander Hood II of Pomerantz LLP.

The AcelRx Securities Exchange Act Class Action Lawsuit is Sneed Jr. v. AcelRx Pharmaceuticals, Inc., Case No. 3:21-cv-04353, in the U.S. District Court Northern District of California.

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