Paula Kuyat v. BioMimetic Therapeutics, Inc., 2014 U.S. App. LEXIS 5738

BioMimetic marketed Augment to aid bone growth; FDA required PMA and defined trial analysis populations ITT and mITT.
BioMimetic amended its protocol to define ITT as all randomized subjects who received treatment post-randomization, effectively proposing an mITT primary analysis.
FDA approved the amendment, explicitly accepting the mITT approach but advising analysis of ITT as well and labeling decisions.
Clinical trials yielded mixed results: ITT non-significant, mITT significant, creating investor communications asserting optimism.
Plaintiffs allege BioMimetic knew of deficiencies but spoke positively about FDA prospects, allegedly misrepresenting FDA expectations.
District court dismissed, holding no strong inference of scienter under PSLRA Tellabs; plaintiffs appeal.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether complaint states a strong inference of scienter under PSLRA	BioMimetic knew trials failed but touted FDA prospects	Company believed mITT analysis could support approval given FDA history	No strong inference; complaint properly dismissed
Whether May 18, 2007 FDA letter supports scienter	Letter showed FDA intended ITT, implying deceit	Letter discusses proper ITT/mITT definitions, not primary ITT requirement	Letter does not establish strong inference of scienter
Whether leave to amend post-judgment was properly denied	Amendment would cure pleading defects	Delay and lack of proper motion justify denial	District court did not abuse discretion; leave to amend denied

Tellabs, Inc. v. Makor Issues & Rights Ltd., 551 U.S. 308 (U.S. 2007) (strong inference standard under PSLRA must be at least as strong as opposing inferences)
Frank v. Dana Corp., 646 F.3d 954 (6th Cir. 2011) (holistic pleadings review for scienter in the Sixth Circuit)
In re Worlds of Wonder Sec. Litig., 35 F.3d 1407 (9th Cir. 1994) (disclosure of adverse information can negate scienter inference)