MEI Pharma, Inc. (MEIP) Accused of Misleading Shareholders
In 2016 MEI Pharma entered into an exclusive license agreement with Helsinn Healthcare SA, a Swiss pharmaceutical corporation (“Helsinn”), in which Helsinn would develop, manufacture, and commercialize Pracinostat while MEI Pharma received $20 million for the grant rights with the potential to receive up to $444 million in regulatory and sales-based milestones along with royalty payments. In August 2017, MEI Pharma and Helsinn announced the beginning of the Phase 3 Pracinostat trial after “the potential of racinostat … was demonstrated in the Phase 2 study,” touting that the “well-powered, rigorously designed Phase 3 study” would bring Pracinostat one step closer to becoming a treatment for those with AML. In later SEC reports and filings, MEI Pharma continued to tout the “potency” and median overall survival of patients in the Phase 2 trial of Pracinostat. Despite the Company’s positive representations of the drug, on July 2, 2020, MEI Pharma announced it was discontinuing the Phase 3 Pracinostat trial, revealing that an interim futility analysis of the study “demonstrated was unlikely to meet the primary endpoint of overall survival compared to the control group.” On this news, MEI Pharma’s shares fell 18% to close at $3.49 per share and has yet to recover.
