Investigation of Sorrento Therapeutics, Inc.
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Sorrento Therapeutics, Inc. (SRNE) Accused of Misleading Shareholders
On May 15, 2020, Sorrento announced that it had discovered an antibody that had “demonstrated 100% inhibition of SARS-CoV-2 virus infection” and stated on national television “[Sorrento] want[s] to emphasize there is a cure.” Following these auspicious statements, Sorrento’s stock price soared to as high as $10.00 per share, representing a 281.7% increase from its May, 14, 2020 closing price. However, on May 20, 2020, Hindenburg Research issued a report calling Sorrento’s claims “sensational,” “nonsense,” and “too good to be true” after speaking with Mount Sinai, the company Sorrento was collaborating with, which cautioned that “nothing in medicine is 100%.” In response, Sorrento’s CEO refuted the Hindenburg report stating “when you see a virus is not infecting the healthy cell, you know you have the real deal.” Finally, on May 22, 2020, BioSpace published an article revealing that in an interview on May 21, 2020, Sorrento’s officers “insist[ed] that they did not say it was a cure” but rather that it could potentially be a cure. On this news, Sorrento’s stock price fell to $4.93 per share, representing a 49.4% decline from its class period high of $10 per share.