Cabaletta Bio, Inc. (CABA) Misrepresented the Viability and Efficacy of its Lead Drug Candidate
A shareholder filed a class action on behalf of persons and entities that purchased or acquired Cabaletta Bio, Inc. (NASDAQ: CABA) (1) common stock pursuant to the Company’s October 2019 IPO or (2) securities between October 24, 2019 and December 13, 2021. Cabaletta Bio is a clinical-stage biotechnology company that discovers and develops engineered T cell therapies for patients with B cell-mediated autoimmune diseases. The Company’s lead product candidate is DSG3-CAART, which is in Phase I clinical trial.
According to the complaint, the documents in support of the IPO were negligently prepared and defendants made misleading statements during the class period. Specifically, the offering documents and defendants’ subsequent statements failed to disclose that top-line data of the Phase 1 Clinical Trial indicated that DSG3-CAART had, among other things, worsened certain participants’ disease activity scores and necessitated additional systemic medication to improve disease activity after DSG3-CAART infusion. Because DSG3-CAART was not as effective as represented to investors, the Company had overstated DSG3-CAART’s clinical and/or commercial prospects.
On December 24, 2021, Cabaletta reported “top-line data on biologic activity from the two lowest dose cohorts in the DesCAARTes™ Phase 1 clinical trial of DSG3-CAART for the treatment of patients with mucosal Pemphigus Vulgaris (mPV).” Among other results, Cabaletta reported that two cohort participants had “disease activity scores that worsened … after DSG3-CAART infusion” and thus “reduced or discontinued selected systemic therapies prior to DSG3-CAART infusion, as required by the protocol,” while another participant “subsequently received systematic medication to improve disease activity after DSG3-CAART infusion.” On this news, Cabaletta’s stock fell $9.15 per share, or over 73% to close at $3.36 per share on December 14, 2021. The stock continues to trade well below the $11.00 IPO price.
Next Steps: If you acquired shares of Cabaletta Bio, Inc. (CABA) pursuant to its IPO or between October 24, 2019 and December 13, 2021, you have until April 29, 2022, to ask the court to appoint you lead plaintiff for the class. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.