HARTFORD, Conn., Sept. 20, 2006 (PRIMEZONE) -- The law firm of Schatz & Nobel, P.C., which has significant experience representing investors in prosecuting claims of securities fraud, announces that a lawsuit seeking class action status has been filed in the United States District Court for the Northern District of California on behalf of all persons who purchased the publicly traded securities of Connetics Corporation (the "Company") (Nasdaq:CNCT) between June 28, 2004 and May 3, 2006, inclusive, (the "Class Period").
The Complaint alleges that Connetics violated federal securities laws by issuing false statements about the Company's most important new drug (Velac) concerning findings that would likely prevent FDA approval. Specifically, it is alleged that defendants concealed the following: (i) the carcinogenicity study of Velac had indicated that 89 out of 160 mice treated with Velac developed tumors; (ii) prior to the Class Period, Connetics had been informed by a panel of toxicology experts that they were unaware of any drug with similar results to Velac ever being approved by the FDA; (iii) Connetics' new Velac drug would be deemed unsafe by the FDA and would not provide the revenue and income promised; (iv) the Company would not be able to achieve the operating results for 2006-2007 as projected due to its inability to launch Velac; and (v) Connetics was falsifying its financials for at least 2005 and likely earlier due to improper accounting for rebates.
On May 3, 2006, Connetics announced it could not file its quarterly report on time due to a restatement of its financial results. On this news, the Company's shares collapsed 45% from the Class Period high. During the Class Period, while the stock was artificially inflated, defendants sold millions of dollars worth of stock.
If you are a member of the class, you may, no later than November 17, 2006, request that the Court appoint you as lead plaintiff of the class. A lead plaintiff is a class member that acts on behalf of other class members in directing the litigation. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions which could affect the overall recovery for class members, including decisions concerning settlement. The securities laws require the Court to consider the class member(s) with the largest financial interest as presumptively the most adequate lead plaintiff(s).
For more information about the case, its claims, and your rights, please contact Schatz & Nobel toll-free at (800) 797-5499, or by e-mail at sn06106@aol.com. To view a copy of the complaint filed by Schatz & Nobel, or for more information about class action cases and Schatz & Nobel, please visit our website: www.snlaw.net.