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Novan Inc (NASDAQ:NOVN) Investor Securities Class Action Lawsuit 11/03/2017

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Lawsuit Overview

Case Dismissed
Company
Novan Inc(NASDAQ:NOVN
Security
NASDAQ: NOVN

Case Name
Novan Shareholder Class Action Lawsuit 11/03/2017
Type of Lawsuit
Shareholder Class Action
Court of Filing
U.S. District Court for the Middle District of North Carolina

Class Period Begin
Class Period End
Deadline To File for Lead
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Summary

January 28, 2019 - The court granted the defendants' motion to dismiss.

June 14, 2018 - A motion to dismiss the amended consolidated complaint was filed.

April 30, 2018 - A second amended consolidated complaint was filed.

November 3, 2017 - An investor in shares of Novan Inc (NASDAQ:NOVN) filed a lawsuit in the U.S. District Court for the Middle District of North Carolina over alleged violations of Federal Securities Laws by Novan Inc in connection with certain allegedly false and misleading statements made in connection with the Company’s initial public offering (“IPO”) on or about September 26, 2016 and between September 26, 2016 and January 26, 2017.

According to the complaint the plaintiff alleges that Novan, certain of its officers and directors, and the underwriters of its IPO violated the Securities Act of 1933 and that Novan and its former CEO and CFO violated the Securities Exchange Act of 1934

More specifically, the plaintiff alleges that in the IPO Registration Statement and Prospectus, and between September 26, 2016 and January 26, 2017, defendants made materially false and misleading statements regarding Novan’s business and outlook, specifically regarding SB204. The plaintiff alleges that the Defendants’ statements falsely stated that the two Phase 3 clinical trials were identical and omitted specific facts as to why the two critical trials were, in fact, not identical, that as a result of these false statements, the Company’s outlook and expected financial performance were not accurately represented to the market at all relevant times and that as a result of defendants’ false statements between September 26, 2016 and January 26, 2017, the price of Novan Inc (NASDAQ:NOVN) stock climbed significantly above the IPO price of $11.00 per share, reaching as high as $29.09 per share on December 7, 2016.

On January 27, 2017, Novan Inc (NASDAQ:NOVN) announced top-line results from the Company’s two, replicate Phase 3 pivotal clinical trials for SB204 in the treatment of acne vulgaris. Shares of Novan Inc (NASDAQ:NOVN) dropped on January 27, 2017 to as low as $3.52 per share.

On June 5, 2017, Novan Inc announced that it was replacing its CEO and co-founder and that it was laying off 20% of its workforce.