In Re Amgen Inc. Securities Litigation

Citations: 544 F. Supp. 2d 1009; 2008 U.S. Dist. LEXIS 24611; 2008 WL 999058Docket: Case Nos. CV 07-2536 PSG (PLAx), CV 07-2849 PSG (PLAx), CV 07-2865 PSG (PLAx), CV 07-3145 PSG (PLAx), CV 07-3320 PSG (PLAx), CV 07-3950 PSG (PLAx)

Court: District Court, C.D. California; February 1, 2008; Federal District Court

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In the case "In re AMGEN INC. SECURITIES LITIGATION," the United States District Court for the Central District of California addressed a class action lawsuit involving allegations of securities fraud against Amgen, Inc. Plaintiffs, including the Lead Plaintiff Connecticut Retirement Plans and Trust Funds, claimed that the company and its individual officers misrepresented the true value of Amgen stock to the investing public, leading to inflated stock prices from April 22, 2004, to May 10, 2007. The individual defendants were key executives at Amgen during this period. The court held a hearing on the defendants' motion to dismiss the Consolidated Amended Complaint on January 28, 2008, ultimately granting the motion in part and denying it in part. The litigation centers around Amgen's marketing of two drugs, Epogen and Aranesp, both of which are erythropoietin-stimulating agents (ESAs) that promote red blood cell production.

In 1989, the FDA approved Epogen for treating anemia linked to chronic renal failure, dialysis, chemotherapy-induced anemia, and other conditions. In 2001, Aranesp was approved for similar uses, including both dialysis and non-dialysis patients. Subsequent approvals allowed Aranesp's use in cancer chemotherapy-related anemia in 2002. 

Multiple large-scale clinical trials on erythropoiesis-stimulating agents (ESAs) occurred in the late 1990s and early 2000s. The Normal Hemocrit Study was halted due to increased blood clotting risks, while the ENHANCE trial found that an epoetin beta product led to shorter survival compared to placebo in head and neck cancer patients. The BEST trial, involving an epoetin alfa product, was stopped after four months due to increased mortality among breast cancer patients.

In May 2004, the FDA convened the Oncology Drug Advisory Committee (ODAC) to address safety concerns regarding Aranesp and other ESAs, particularly in light of findings from the ENHANCE and BEST trials. Before the meeting, Amgen executives downplayed the significance of the safety concerns related to Aranesp. During the ODAC meeting, the FDA recommended that Amgen conduct further clinical trials to address safety issues. Amgen presented its Pharmacovigilance Program, which included five trials, one of which was the DAHANCA 10 Trial, investigating high doses of Aranesp in head and neck cancer patients. This trial was temporarily halted on October 18, 2006, due to concerns over potential negative effects related to the EPO receptor.

Amgen was notified of a significant development regarding the DAHANCA 10 protocol around October 18, 2006, leading to the study's termination on December 1, 2006, due to evidence that Aranesp treatment correlated with worse tumor growth outcomes in patients with head and neck cancer. A report from The Cancer Letter on February 16, 2007, highlighted the trial's halt, which contributed to a 2.3% drop in Amgen's stock price. Following an SEC inquiry about the DAHANCA trial on February 28, 2007, Amgen's stock fell further the next day.

On November 20, 2006, Amgen responded to findings from the CHOIR and CREATE clinical trials. The CHOIR trial was terminated early due to increased mortality and cardiovascular hospitalizations associated with epoetin alfa in chronic kidney disease patients. In the CREATE trial, Roche Pharmaceuticals claimed no cardiovascular benefit was found from higher hemoglobin treatment targets. Amgen defended its products, stating they are safe and effective within FDA-approved dosing guidelines.

On January 25, 2007, during a conference call, Amgen discussed the results of the 103 Study, which indicated a shorter survival rate for cancer patients receiving Aranesp compared to those receiving transfusions. Amgen's Executive Vice President stated that the risk-benefit ratio for Aranesp in severely ill cancer patients was at best neutral, potentially negative.

The document also notes prior statements by Amgen executives in 2002 and 2004 that claimed Aranesp had a strong safety profile and no adverse effects on cancer patient survival, contrasting with later findings. In February 2007, Amgen's CEO reiterated the belief in the safety and effectiveness of Aranesp and Epogen when used as indicated.

Amgen is accused of executing a comprehensive off-label marketing strategy for its erythropoiesis-stimulating agents (ESAs), Aranesp and Epogen, while the FDA was questioning their safety for approved uses. Key elements of this scheme included: 

1. Training sales representatives to initiate off-label discussions with physicians.
2. Establishing a "speakers program" where paid "experts" promoted off-label uses to medical professionals.
3. Encouraging physicians to prescribe higher dosages, such as intravenous administration of Epogen, to maximize sales.
4. Promoting the financial advantages of high-volume prescriptions, violating Medicare regulations.
5. Providing tools for sales reps to calculate profit margins for using Amgen's drugs.

Despite issuing a press release on December 4, 2006, claiming compliance with FDA labeling, Amgen faced growing scrutiny. On February 23, 2007, Aranesp was delisted as a cancer anemia treatment by a major reference guide, raising concerns about insurance coverage. Subsequent reports indicated that ESAs could worsen cancer outcomes and led to a March 9, 2007, FDA black box warning about risks associated with high doses, including increased mortality and adverse events. Following the FDA advisory, Amgen's stock dropped, and Medicare announced cuts to reimbursements for erythropoietin. Further analysis on May 8, 2007, deemed Aranesp and Epogen unacceptable at high doses, while a May 9 article revealed Amgen's practice of providing rebates to physicians based on their prescription volumes.

On May 10, 2007, the Oncologic Drugs Advisory Committee (ODAC) convened to review the status of erythropoiesis-stimulating agents (ESAs). Following testimony from the FDA and ESA marketers, ODAC voted to restrict ESA use, expand warnings, and mandate further studies from manufacturers to substantiate current indications. The FDA determined that Amgen had misrepresented findings in two studies. In Study 161, Amgen claimed Aranesp had a comparable safety profile to placebo, but the FDA found reduced overall survival and increased blood clotting in Aranesp patients. In Study 145, although Amgen reported no overall survival difference, the FDA noted that the lack of demonstrated improvement did not rule out the potential for decreased survival. On that day, Amgen's stock price dropped significantly from $63.10 to $57.33.

On October 1, 2007, plaintiffs filed a Consolidated Amended Class Action Complaint alleging violations of federal securities laws, specifically § 10(b) of the Securities Exchange Act of 1934 and § 20 against all defendants. The complaint asserts that defendants made materially false and misleading statements regarding ESA safety, engaged in unlawful marketing, and artificially inflated Amgen's stock price during a specified period. Defendants have moved to dismiss the complaint for failure to state a claim.

Under Federal Rule of Civil Procedure 12(b)(6), a complaint can be dismissed if it fails to state a claim upon which relief can be granted. Plaintiffs must provide sufficient facts to support a legal theory, and courts will accept all factual allegations as true, drawing reasonable inferences in favor of the plaintiff. Dismissal without leave to amend is warranted only if deficiencies cannot be cured. The Private Securities Litigation Reform Act (PSLRA) imposes heightened pleading standards in securities fraud cases, requiring particularity in alleging both falsity and scienter to prevent abusive litigation practices.

To comply with the Private Securities Litigation Reform Act (PSLRA), a complaint must clearly identify each allegedly misleading statement, explain why it is misleading, and, if based on belief, detail the facts supporting that belief. Regarding scienter, the PSLRA mandates plaintiffs to present specific facts that create a strong inference of the defendant's required mental state. While the PSLRA does not define "strong inference," the Supreme Court in Tellabs, Inc. v. Makor Issues Rights, Ltd. clarified that courts must consider plausible opposing inferences and that the inference of scienter must be cogent and compelling. A complaint will only survive if the inference of scienter is deemed as compelling as any opposing inference. Additionally, all allegations must be evaluated collectively rather than in isolation. In assessing a Rule 12(b)(6) motion to dismiss a § 10(b) action, courts must accept all factual allegations as true.

The court also addressed requests for judicial notice under Federal Rule of Evidence 201, which permits acknowledgment of facts that are indisputable and easily verifiable. The court granted the defendants' requests for judicial notice of certain exhibits, including FDA labels and SEC filings, as they are appropriate for judicial notice. Items referenced in the complaint were also accepted under the incorporation by reference doctrine, including articles and public health advisories. Analyst reports may be considered to determine when information was available to the market but not for the truth of the assertions within those reports.

Plaintiffs did not challenge the authenticity of the analysts' reports, leading the Court to grant Defendants' request for judicial notice of Exhibit 8, contingent on admissibility. The Court also took judicial notice of Exhibit 11, a LexisNexis report detailing Amgen's daily stock prices from April 1, 2004, to October 31, 2007. The Court approved Plaintiffs' request for judicial notice of Exhibits 1 and 2, which include a proxy statement and SEC Form 4s. However, it denied requests for Exhibit 3 (a Raw Data report on insider trading) and Exhibit 3A (a subset of that data), determining they did not meet the criteria for judicial notice. Exhibit 4, a transcript from the May 2007 ODAC meeting, was recognized under the incorporation by reference doctrine. 

The excerpt outlines the legal framework of Section 10(b) of the Exchange Act, prohibiting manipulative practices in securities transactions, and explains SEC Rule 10b-5, which specifically addresses fraudulent actions. For a private action under § 10(b), a plaintiff must establish six elements, including a material misrepresentation by the defendant and a connection to economic loss. 

Plaintiffs claim Defendants made misleading statements regarding financial performance and product safety, including statements made by Defendant Morrow during a conference call on April 22, 2004, about the 2004 ODAC Meeting and the safety of Amgen's ESA products.

Plaintiffs claim Morrow's statements were misleading, asserting he misrepresented or omitted critical information regarding the FDA's inquiry into Amgen-manufactured ESAs for oncology patients. Specifically, they point to a March 30, 2004, Federal Register notice indicating safety concerns with ARANESP and PROCRIT in cancer chemotherapy. Plaintiffs contend Morrow failed to acknowledge that the FDA would likely apply safety signals from earlier trials to all ESA drugs, including ARANESP, and that no clinical trials had been designed to assess overall survival rates, undermining the claim that ARANESP's safety was comparable to a placebo.

Defendants counter that the meeting agenda was publicly available and attended by the press, suggesting that Morrow's statements could not mislead the market. They invoke the "truth-on-the-market" defense, arguing that if information is credibly available, failure to disclose does not constitute liability. However, the Court finds that mere public availability of the agenda does not absolve the Defendants of potential liability.

Additionally, Defendants argue that Plaintiffs have not sufficiently pleaded scienter, as there are no facts suggesting Morrow did not genuinely believe his statements. The Court disagrees, finding that allegations in the Complaint, particularly Morrow's contradictory statements about the meeting's focus and existing safety concerns from prior European trials, support a strong inference of deliberate recklessness on Morrow’s part. Thus, the Court deems dismissal of the case at this stage inappropriate.

In the ENHANCE trial, patients with head and neck cancer experienced significantly shorter progression-free and overall survival compared to a placebo group. The BEST trial was halted after four months due to increased mortality among breast cancer patients using an epoetin alfa product. Amgen was aware that the clinical trials supporting Aranesp's FDA approval were not designed to assess survival rates, leading to allegations that the FDA would interpret negative safety signals from earlier trials as applicable to all ESA drugs, including Aranesp. These details suggest Amgen's culpability and support the inference of scienter.

Defendants contend that the lack of stock price movement following an ODAC meeting undermines claims of loss causation, which requires a link between a misrepresentation and a resulting financial loss, typically evidenced by a corrective disclosure. However, the court found that plaintiffs sufficiently alleged several corrective disclosures through various news outlets. While there was no significant price change after the 2004 ODAC Meeting, the 2007 meeting allegedly revealed serious safety concerns that led to a decline in Amgen's stock price from $63.10 to $57.33 as the implications of Morrow's earlier statements became clear.

Plaintiffs also challenged statements made by Amgen executives regarding Aranesp's growth in 2004 and 2005. Executives expressed optimism about Aranesp's potential in various communications, with claims of strong growth prospects and market expansion efforts. Defendants argued that such statements were too vague to be relied upon by investors and constituted mere "puffery," referencing a prior Ninth Circuit case that dismissed similar claims based on generalized expressions of optimism.

Defendants' comparison to Glen Holly is ineffective, as the allegations in the Consolidated Amended Complaint (CAC) regarding the growth potential of Aranesp are more specific than the "mere puffery" found in Glen Holly. The CAC outlines various optimistic statements made by Amgen and its executives from April 22, 2004, to May 10, 2007, which could support a claim under section 10(b). The Supreme Court's ruling in Virginia Bankshares clarifies that opinions or beliefs can be actionable if they are known to be false or lack a reasonable factual basis. The CAC claims that Defendants were aware their optimistic statements about Aranesp and Epogen's growth potential contradicted the evolving safety profiles of erythropoiesis-stimulating agents (ESAs), especially given the FDA's concerns stemming from Amgen's non-compliance with recommended clinical trials. 

Despite Defendants arguing that Plaintiffs cannot demonstrate economic loss due to accurate growth predictions, Plaintiffs contend that Amgen's growth was unsustainable, citing illegal marketing practices and misleading assertions about ESAs' safety. The CAC alleges that Defendants' statements materially misrepresented the actual situation, thus establishing loss causation. Plaintiffs also assert economic loss linked to drops in Amgen's stock price following negative FDA reports regarding ESAs. 

Defendants claim insufficient evidence showing they lacked a reasonable basis for optimism about Aranesp; however, the CAC argues their statements were untenable given the known safety issues. Lastly, Defendants assert their growth predictions are "forward-looking statements" protected under the PSLRA's "safe harbor" provisions. Plaintiffs must demonstrate that these statements were made with actual knowledge of their misleading nature, a requirement that has not been met, according to Defendants.

Plaintiffs' factual allegations suggest that Sharer, Morrow, and Nanula knowingly made false or misleading statements regarding the safety and market potential of Aranesp. At the 2004 ODAC meeting, the FDA instructed Amgen to conduct specific clinical trials addressing safety issues related to erythropoiesis-stimulating agents (ESAs) in cancer patients, including safety at approved hemoglobin levels. However, by the 2007 ODAC meeting, no trials had been conducted to address these safety concerns, implying that the Defendants were aware their statements made in 2004 and 2005 about seeking additional indications and the potential for market growth were misleading.

Additionally, the Plaintiffs allege that the Individual Defendants were aware of Amgen's illegal marketing practices for Aranesp, which involved training sales representatives to initiate off-label discussions and providing them with extensive off-label marketing materials. Such practices contributed to misleading projections about sales growth, which were largely based on unapproved uses of the drug.

From November 20, 2006, to May 3, 2007, Defendants made various statements asserting the safety of on-label uses of Aranesp and Epogen, claiming strong conviction in their safety despite reports of concerns with off-label uses. Plaintiffs contest these assertions, arguing that there was insufficient evidence at the time to support claims of safety for on-label use and that Amgen was aware of significant safety concerns highlighted in well-designed clinical trials. The court finds that Plaintiffs have provided sufficient allegations to support their claims of "actual knowledge" of misleading statements by the Defendants.

Amgen did not conduct necessary studies related to the on-label use of Aranesp, leading to allegations that the company knowingly made false and material statements to investors. Plaintiffs claim Amgen failed to disclose adverse outcomes from the DAHANCA 10 Trial, which investigated Aranesp's off-label use in head and neck cancer patients. After learning about these adverse outcomes on October 18 and December 1, 2006, Amgen did not timely report that the study had been temporarily halted and subsequently terminated due to indications of impaired survival in treated patients. 

Under the Securities Exchange Act and Rule 10b-5, omissions are actionable if there is a duty to disclose material facts that render prior statements misleading. The plaintiffs cite instances where Amgen publicly discussed the DAHANCA trial's significance in addressing FDA safety concerns and made statements asserting the safety and efficacy of Aranesp and EPOGEN according to FDA-approved guidelines. These public representations included remarks from company executives regarding the credibility of their pharmacovigilance efforts and the safety of their products, raising concerns about the misleading nature of their disclosures.

Plaintiffs assert, and the Court concurs, that Defendants were obligated to disclose the suspension of the DAHANCA 10 trial on October 18, 2006, due to safety concerns. Defendants’ prior assurances that the Amgen Pharmacovigilance Program, including the trial, would address safety questions from a 2004 meeting imposed this disclosure duty. By failing to announce the trial's halt, Defendants misled stakeholders into believing the trial was ongoing. Similarly, they were required to disclose the decision to terminate the study entirely. 

Defendants argue that they are not liable for securities fraud because the Interim Analysis results were posted on DAHANCA's website on December 1, 2006, claiming this information was publicly available. However, the Court notes that mere posting does not equate to market awareness, as evidenced by a February 2007 article indicating insufficient market communication regarding the results. Defendants justified their nondisclosure of the Interim Analysis by claiming it was premature and lacked significant data; however, the Court determined that the early termination of the trial indicated a clear inability to use the study results to address FDA inquiries about the safety of ESAs.

Defendants also contended that the Interim Analysis was not material to disclose, asserting that it did not provide significant evidence linking adverse effects to Aranesp. The Court found that the findings of worse tumor growth and impaired survival in patients taking Aranesp were sufficient to establish a strong inference that Defendants understood their omission would mislead the market. Additionally, the 103 Study aimed to evaluate off-label use of Aranesp for cancer-related anemia. Notably, on January 25, 2007, Amgen held a conference call with analysts discussing its earnings after being aware of the DAHANCA 10 Trial results but before they were publicly released.

Defendant Perlmutter, Amgen's Executive Vice President of Research and Development, reported during a conference call that the 103 Study did not demonstrate a statistically significant reduction in transfusions over 16 weeks and indicated a statistically adverse effect of Aranesp on overall mortality in patients with anemia due to malignancy. He concluded that the risk-benefit ratio of Aranesp in this severely ill patient population was neutral or potentially negative. Plaintiffs argue that Perlmutter’s characterization of the study results as "neutral, and perhaps negative" misled the market into thinking the study was not a failure. In contrast, Defendants maintain that Perlmutter's statements were clear and did not mislead investors regarding Amgen's intentions to expand the drug's label. The complaint suggests that Perlmutter was aware of the study's termination in December 2006 due to concerns over survival, raising an inference that he knew his statements were false. 

Additionally, Plaintiffs assert that Defendants are liable for falsely claiming in SEC filings that Amgen marketed Aranesp and Epogen according to their approved indications. Defendants counter that reliance on anonymous witnesses undermines the Plaintiffs' ability to meet the "strong inference" requirement for scienter under the Private Securities Litigation Reform Act (PSLRA). The Supreme Court's decision in Tellabs I established that a complaint must present an inference of scienter that is as compelling as any opposing inference. The Seventh Circuit has suggested that allegations from confidential witnesses should be discounted rather than ignored, emphasizing the need for a careful evaluation of the allegations in their entirety.

Higginbotham's confidential sources included three ex-employees and two consultants of the defendant, while the case of Tellabs II featured numerous confidential informants knowledgeable about the relevant facts. In Tellabs II, the informants provided detailed information, and although the court preferred their names to be included, their anonymity did not undermine the strong inferences drawn from their assertions. The current case's confidential witnesses resemble those in Tellabs II. For example, CW1, a former Amgen district sales manager, detailed a sales aid that directed questions to Amgen customers about using Aranesp for specific patient groups. CW2, a former interim district sales manager, noted that Amgen, while denying off-label promotion, equipped sales staff with materials to discuss off-label topics. CW4, an oncology sales representative, explained that Amgen sponsored programs to promote off-label uses. The Court found that the Plaintiffs presented sufficient facts to infer that Defendants engaged in surreptitious marketing of Aranesp and Epogen for off-label uses. The Complaint identified the roles and regions of the confidential witnesses and provided detailed information from them, which upheld the strength of the inferences despite their anonymity. Furthermore, the Defendants argued that the Plaintiffs' claims improperly sought to enforce the Federal Food, Drug, and Cosmetic Act (FDCA), which the FDA exclusively administers. They asserted that to prove material falsity, the Plaintiffs must demonstrate that a substantial portion of Amgen's sales resulted from illegal marketing practices, a determination only the FDA can make. The Court countered that the issue was not about the FDA’s approval of Amgen's products but whether Defendants violated securities laws through improper marketing of Epogen and Aranesp, emphasizing that the FDA does not have jurisdiction over securities law violations.

The FDA does not preempt Plaintiffs' claims against Amgen, as evidence suggests that the company's marketing practices originated from its national office. Plaintiffs have pointed to the widespread and lucrative nature of the marketing scheme, along with press releases asserting compliance with FDA regulations, indicating that Amgen executives likely had knowledge of and acted with deliberate recklessness regarding the scheme. Defendants' challenge to the causation element is countered by allegations that concerns about Amgen’s marketing practices were expressed at a 2007 ODAC Meeting, resulting in a significant drop in Amgen's stock price. Under the precedent established in Dura Pharmaceuticals, Plaintiffs have sufficiently demonstrated causation by alleging a stock price decline following the revelation of the truth.

Additionally, Plaintiffs assert that Amgen made false and misleading statements to the SEC during the Class Period, not disputing the accuracy of reported figures but claiming misrepresentations regarding safety issues, undisclosed risks, and misleading characterizations of clinical trial results that distorted investor perceptions of Amgen’s earnings. Defendants argue that accurate historical data cannot constitute a violation under Section 10(b) of the Securities Exchange Act. However, misleading statements can occur even when literal accuracy is present, especially if they create a materially false impression of the company’s practices. Defendants misled investors by claiming compliance with approved marketing indications while engaging in unapproved promotions and improper practices, thereby falsely assuring that no illegal activities were involved in their successes.

The court found that the allegations in the Consolidated Amended Complaint (CAC) were sufficient to support an inference of scienter, allowing the case to proceed past the motion to dismiss stage. Plaintiffs attempted to bolster their claims by detailing the stock sales of Individual Defendants, highlighting the date, number of shares, and market value of these transactions. Suspicious stock sales can serve as circumstantial evidence of scienter, particularly if they deviate significantly from prior trading patterns and occur at times advantageous for the seller, as established in relevant case law. However, the court concluded that the plaintiffs failed to adequately demonstrate that the Individual Defendants' stock sales were inconsistent with their previous trading behavior or strategically timed to benefit from undisclosed information. Consequently, these sales did not strengthen or weaken the plaintiffs' arguments regarding scienter.

Regarding the group pleading doctrine, the defendants contested the sufficiency of the plaintiffs' claims against the Individual Defendants, asserting that the plaintiffs did not provide enough factual detail to prove that each defendant was responsible for the challenged statements or acted with scienter. The plaintiffs claimed the Individual Defendants, due to their positions, had access to undisclosed adverse information and participated in the preparation of public statements. They also noted that certain defendants signed the Company’s Annual Report. The court referenced the "group published information" doctrine, which allows plaintiffs to infer collective responsibility for misleading statements made in documents issued by the company’s officers and directors.

To invoke the "group published information" presumption, plaintiffs must allege that an outside director was involved in the corporation's daily operations or had a special relationship with it, such as participating in the dissemination of group information at specific times. There is ongoing debate among circuits about whether the group pleading doctrine remains valid under the PSLRA's heightened pleading standards. Some circuits, including the Third, Fifth, and Seventh, argue that the PSLRA's requirements for particularity in allegations regarding each defendant's state of mind make group pleading inconsistent with the statute. The Ninth Circuit has not definitively ruled on the matter, and while some district courts have questioned the doctrine's survival, others, including the Ninth Circuit in *Silicon Graphics*, have applied it post-PSLRA. After reviewing various positions, the Court aligns with the Seventh Circuit's reasoning in *Tellabs*, emphasizing that the PSLRA demands that allegations provide a strong inference of scienter for each defendant individually in cases involving multiple defendants. Consequently, the Court concludes that the group pleading presumption is no longer applicable following the enactment of the PSLRA.

Allegations against outside directors Fritzky, Omenn, and Johnson, as well as nonspeaking officers Fenton and McNamee, are limited to group pleading assertions, which the Court determined are no longer valid. Consequently, the Court dismissed these Defendants without prejudice. Under Section 20(a) of the Exchange Act, liability is imposed on individuals who control others committing violations, requiring a plaintiff to show (1) a primary violation of federal securities laws and (2) that the defendant exercised actual power or control over the violator. While the first element is met with adequate allegations of a primary violation by Amgen, the second element is only satisfied for some Individual Defendants. Control is established through oversight of daily operations; mere status as an officer or director is insufficient. However, signing materially false financial statements can indicate control. The CAC claims that executives Sharer and Nanula signed SEC financial statements and that all Individual Defendants participated in drafting and approving public communications, meeting the control requirement for Sharer, Nanula, Perlmutter, and Morrow. In contrast, the allegations do not satisfy the control element for outside directors and nonspeaking officers, resulting in their dismissal.

The Court granted in part and denied in part the Defendants' Motion to Dismiss the Consolidated Amended Complaint (CAC). Individual Defendants Fritzky, Omenn, Johnson, Fenton, and McNamee were dismissed from the Plaintiffs' claims under sections 10(b) and 20(a) without prejudice. Conversely, the motion was denied for Individual Defendants Sharer, Nanula, Perlmutter, and Morrow, allowing the Plaintiffs' 10(b) and 20(a) claims to proceed against them. Plaintiffs were granted leave to amend the CAC to correct identified deficiencies within 30 days, as per the precedent set in Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995). Additionally, it was noted that while the FDA does not restrict physicians from prescribing drugs for off-label uses, drug companies are limited to providing information about such uses only in response to inquiries from physicians.