Elanco Board Sued Over Safety, FDA Setbacks for Dog Itch Drug

Elanco Animal Health Inc.'s directors are responsible for failing to disclose the safety risks of a canine dermatology treatment in development and the likelihood of delays in FDA approval, an investor alleges.

The board members breached their fiduciary duties to Elanco by not disclosing a study showing that the drug candidate, Zenrelia, was riskier than investors had been told, the investor said on behalf of the company in a suit Monday in the US District Court for the District of Maryland.

The directors also reported “no change at all” in Zenrelia’s Food and Drug Administration approval process—and a timeline of approval and launch in 2024—despite the existence of that study, investor Christopher Dougherty said. The study showed that Zenrelia had a negative effect on dogs given modified live vaccines against several canine disease viruses, according to the complaint. Serious complications led to the euthanization of two dogs in the study, Dougherty says.

The harm to Elanco includes its costs and exposure to liability in a proposed class action pending in the District of Maryland; the costs of internal investigations and other measures; and the “overcompensation” of the board members, Dougherty says. The class action also alleged issues with an anti-parasite product and cited a 21% stock drop on June 27, 2024.

Dougherty brings claims for proxy misstatements, breach of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, waste of corporate assets, and contribution. He seeks damages, restitution, and corporate governance reforms.

Elanco didn’t immediately respond to an emailed request for comment on behalf of the company and the individual defendants.

The Brown Law Firm PC represents Dougherty.

The case is Dougherty v. Simmons, D. Md., No. 1:25-cv-01357, complaint 4/28/25.