Investigation of Adamas Pharmaceuticals

Adamas Pharmaceuticals, Inc. (ADMS) Accused of Misleading Shareholders 

According to the complaint for alleged violations of the Securities Exchange Act of 1934 between August 8, 2017 and September 30, 2019, throughout the relevant period, Adamas consistently assured investors of insurer support for its drug GOCOVRI, touting that ” is seeing prescription fulfillment across most every plan” and “the vast majority of plans give good support for reimbursement for GOCOVRI.” However, on October 5, 2018, an analyst at Bank of America/Merill Lynch downgraded Adamas, revealing a survey of doctors showed a higher-than-expected dropout rate for GOCOVRI due to high cost and difficulty in securing prior authorization from payers. Then, on March 4, 2019, Adamas revealed during a conference call that the Company was rescinding its previous prescription growth estimates for GOCOVRI and warned of a continued slow-down in GOCOVRI prescriptions. Finally, on September 20, 2019, another analyst from Bank of America/Merill Lynch lowered its rating for Adamas shares to “underperform,” citing the exclusion of GOCOVRI on a number of national formularies and anticipated reimbursement hurdles as reasons. Since this news, the stock has declined almost 73% from its October 5, 2018 closing price of $23.81, currently trading at around $6.50.

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