Y-mAbs Therapeutics, Inc. (YMAB) Misrepresented the Viability and Efficacy of its Lead Drug Candidate
A shareholder filed a class action on behalf of all investors who purchased share of Y-mAbs Therapeutics, Inc. (NASDAQ: YMAB) common stock between October 6, 2020 and October 28, 2022, for violations of the Securities Exchange Act of 1934. Y-mAbs is a clinical-stage biopharmaceutical company focused on developing antibody therapeutics and medicines for the treatment of cancer patients of all ages. The Company’s lead product candidate is Omburtamab, a murine monoclonal antibody that targets B7-H3, an immune checkpoint molecule that is widely expressed in tumor cells of several cancer types. According to Y-mAbs, “131I-omburtamab, which is omburtamab radiolabeled with Iodine-131, is currently being studied in several clinical trials including pivotal stage development Study 101 and Study 03-133 for the treatment of pediatric patients who have CNS/LM from NB.”
According to the complaint, Y-mAbs sought FDA approval of omburtamab through a Biologics License Application first in 2020 and again in 2022, based on a comparison between Study 03-133 performed at Memorial Sloan Kettering Cancer Center (“MSKCC”) and an external cohort comprising data from the Central German Childhood Cancer Registry, or CGCCR, database.
The FDA declined marketing approval of omburtamab in a Refusal to File (RTF) letter dated October 2, 2020, informing Y-mAbs that additional data, including evidence of durable response were necessary to provide the level of evidence needed to support an approval.
Y-mAbs disclosed the existence of the RTF letter in a press release dated October 5, 2020, and in an investor conference call the morning of October 6, 2020, but misrepresented the FDA’s willingness to approve omburtamab for marketing based on the existing clinical trials. In fact, during the class period, Y-mAbs misrepresented to investors that, pursuant to a series of meetings and other communications between Y-mAbs and the FDA, progress was being made that would align with the FDA’s requirement to demonstrate substantial evidence of effectiveness, sufficient for approval of omburtamab, through adequate and well-controlled studies.
To the contrary, the FDA had repeatedly advised the defendants that the FDA was unlikely to grant approval for the marketing of omburtamab based on a comparison between Study 03-133 and CGCCR because of substantial differences in the patient populations, and the absence of tumor response data, and that Study 101 was neither sufficiently advanced nor indicative of efficacy to justify approval. The truth was first disclosed to investors on October 26, 2022, when the FDA published its Briefing Document for an October 28, 2022 Advisory Committee Meeting, and again on October 28, 2022, when the Committee voted 16-0 against recommending approval of omburtamab. On this news, Y-mAbs common shares fell $11.56 per share, to close at $3.61 per share on October 31, 2022.
What Now: Similarly situated shareholders may be eligible to participate in the class action against Y-mAbs. Shareholders who want to act as lead plaintiff for the class must file their papers by March 30, 2023. 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.