Sixth Circuit Affirms Dismissal of Class Complaint Against BioMimetic Therapeutics

A federal appeals court upheld dismissal of a shareholder class action against BioMimetic Therapeutics Inc., holding March 28 that the company’s optimistic statements to investors over ultimately unsuccessful clinical trials of a bone regrowth product did not constitute securities fraud (Kuyat v. BioMimetic Therapeutics, Inc., 2014 BL 86243, 6th Cir., 13-5602, 3/28/14).

The plaintiffs alleged that BioMimetic knew of problems facing clinical trials for Augment, which is designed to promote bone growth with medicine to aid recovery from surgery, but “spoke optimistically to investors about the device’s prospects” for Food and Drug Administration approval regardless, the U.S. ...