Axsome Must Face Securities Fraud Suit Over Migraine Drug Delays

Axsome Therapeutics Inc. investors can proceed with a proposed class action alleging the drugmaker misled them about a migraine treatment’s progress toward FDA approval, a federal court ruled.

The investors adequately alleged that Axsome and two of its executives made positive statements about the timeline in conflict with what they knew about manufacturing equipment problems and the resulting supply of the drug candidate, Judge Lorna G. Schofield said Monday for the US District Court for the Southern District of New York. But three other executives are out of the suit, she said.

• The investors sued following the company’s announcement that ...