In Re Amarin Corp. PLC Securities Litigation
689 F. App'x 124
3rd Cir.2017Background
- Amarin developed Vascepa and sought FDA approval (ANCHOR indication) to reduce triglycerides (TGs) in patients on statins; ANCHOR was a 12-week trial using TG reduction as a surrogate endpoint for cardiovascular benefit.
- In a 2008 FDA meeting the agency said it was “not aware” of long-term outcome trials proving TG reduction reduces major cardiac events, and stated Amarin would need to submit ANCHOR data and “initiate an appropriately-designed cardiovascular outcomes study” that was “well under way.” Amarin did not disclose the 2008 minutes to investors.
- Amarin obtained a 2009 SPA (FDA agreed with ANCHOR’s design/endpoints but called approvability a “review issue”) and later a 2011 SPA for the long-term outcomes trial (REDUCE-IT). The SPAs did not guarantee approval and the FDA reserved approval criteria as a review issue.
- After intermediate outcome trials (ACCORD, AIM-HIGH) failed, Amarin submitted a supplement in 2013; the FDA’s advisory committee voted to reject ANCHOR and the FDA rescinded the 2009 SPA based on the totality of subsequent evidence.
- Plaintiff Reiss sued under §§10(b)/20(a), alleging 87 statements were false or misleading because defendants omitted FDA reservations and said an outcomes trial was ‘‘not required’’ for approval; the district court dismissed for failure to plead a materially misleading statement. The Third Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether defendants omitted material FDA reservations making public statements misleading | Reiss: defendants omitted 2008 minutes and SPA comments showing FDA likely would require a completed outcomes trial, so statements that a trial was “not required” were misleading | Amarin: statements accurately reflected FDA positions (SPA/meeting); FDA characterized approvability as a “review issue,” did not require completion of an outcomes trial before approval | Held: Statements were not materially misleading; no duty to disclose the 2008 minutes/SPA because FDA never mandated a completed outcomes trial during the Class Period. |
| Whether defendants’ optimistic statements and projections were actionable | Reiss: optimism created misleading impression of a ‘‘clear path to approval’’ | Amarin: opinions and optimism were honestly held and had reasonable basis; disclosures and 10-K warnings tempered investor expectations | Held: Opinions/optimism not actionable absent allegations they were not honestly believed or lacked reasonable basis; plaintiff pleaded only hindsight. |
| Whether district court applied improper pleading standard or weighed evidence | Reiss: district court improperly weighed evidence and failed to consider statements in the aggregate | Amarin: district court properly applied Rule 12(b)(6)/PSLRA standards and relied on incorporated documents | Held: District court’s approach proper; did not impermissibly weigh evidence. |
| Whether precedent (Zak) required a different result | Reiss: Zak compels reversal because SPA in Zak led to liability when FDA changed view | Amarin: Zak involved an SPA where FDA explicitly required two successful studies; here FDA never required a completed outcomes trial | Held: Zak is distinguishable and does not compel reversal. |
Key Cases Cited
- Matrixx Initiatives, Inc. v. Siracusano, 563 U.S. 27 (materiality and duty to disclose; no blanket duty to disclose everything)
- Basic Inc. v. Levinson, 485 U.S. 224 (materiality defined by "total mix" standard)
- City of Edinburgh Council v. Pfizer, Inc., 754 F.3d 159 (10b-5 false/misleading standard; reliance on context)
- In re Aetna, Inc. Sec. Litig., 617 F.3d 272 (elements of securities fraud claim)
- OFI Asset Mgmt. v. Cooper Tire & Rubber, 834 F.3d 481 (statements of opinion/forecasts not actionable absent lack of reasonable belief)
- In re Merck & Co., Inc. Sec., Derivative & ERISA Litig., 543 F.3d 150 (opinion statements and reasonable basis analysis)
- Zak v. Chelsea Therapeutics Int'l, Ltd., 780 F.3d 597 (SPA context where FDA expressly required multiple efficacy studies)
- Omnicare, Inc. v. Laborers Dist. Council Constr. Indus. Pension Fund, 135 S. Ct. 1318 (limitations on liability for statements of opinion)