Spero Therapeutics, Inc. (SPRO) Failed to Obtain FDA Approval of One of its Lead Product Candidates
A shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Spero Therapeutics, Inc. (NASDAQ: SPRO) securities between October 28, 2021 and May 2, 2022. The complaint alleges violations of the Securities Exchange Act of 1934. Spero is clinical-stage biopharmaceutical company that develops treatments for multi-drug resistant (MDR) bacterial infections and rare diseases in the United States. The Company’s product candidates include Tebipenem Pivoxil Hydrobromide (HBr), an oral carbapenem-class antibiotic to treat complicated urinary tract infections.
According to the complaint, during the class period, defendants failed to disclose that the data submitted in support of the Tebipenem HBr NDA were insufficient to obtain FDA approval and therefore, it was unlikely that the FDA would approve the Tebipenem HBr NDA in its current form. The failure to obtain FDA approval necessitated a significant workforce reduction and restructuring of Spero’s operations, and as a result, the Company’s public statements were materially false and misleading.
On March 31, 2022, Spero announced the Company’s fourth quarter and full year 2021 financial results, disclosing that the FDA “has notified Spero that, as part of its ongoing review of Spero’s New Drug Application (NDA) for tebipenem HBr, it has identified deficiencies that preclude discussion of labeling and post-marketing requirements/commitments at this time.” On this news, Spero’s stock price fell $1.59 per share, or 18.27%, to close at $7.11 per share on April 1, 2022.
Then on May 3, 2022, Spero issued a press release announcing “that it will immediately defer current commercialization activities for tebipenem HBr based on feedback from a recent Late Cycle Meeting (LCM) with the U.S. Food and Drug Administration (FDA) regarding Spero’s New Drug Application (NDA) for tebipenem HBr[,]” and that, “[a]lthough the review is still ongoing and the FDA has not yet made any final determination regarding approvability, the discussion suggested that the data package may be insufficient to support approval during this review cycle.” Specifically, the FDA advised the Company, in relevant part, that the FDA’s separate analysis of the relevant study population had “reduce[d] the number of evaluable patients in the primary analysis population compared with those resulting from the trial’s pre-specified micro-ITT population as outlined in the statistical analysis plan” and [a]s a result, the FDA considers that the pre-specified non-inferiority margin of -12.5% was not met.” Further, the press release advised that, “[i]n connection with this development, Spero announced that it is undertaking a reduction in its workforce by approximately 75% and a restructuring of its operations to reduce operating costs and reallocate resources.” On this news, Spero’s stock price fell $3.24 per share, or 63.65%, to close at $1.85 per share on May 3, 2022.
Next Steps: If you acquired shares of Spero Therapeutics, Inc. (SPRO) securities between June 29, 2021 and May 19, 2022, you have until July 25, 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.
