NEW YORK, April 11, 2007 (PRIME NEWSWIRE) -- Harwood Feffer LLP today announced that a class action suit has been commenced on behalf of all persons who purchased the common stock of Eli Lilly and Company ("Lilly" or the "Company") (NYSE:LLY) between March 28, 2002 and December 22, 2006, both dates inclusive (the "Class Period").
The action is pending in the United States District Court for the Eastern District of New York, and names as defendants the Company as well as certain senior officers and directors. A copy of the complaint can be obtained from the Court or can be viewed on Harwood Feffer web site at www.hfesq.com .
The Complaint charges defendants with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, as a result of misleading statements issued by defendants regarding Zyprexa, the Company's top-selling drug treatment for schizophrenia. More specifically, the Complaint alleges that, during the Class Period, the defendants failed to disclose: (i) the dangerous side-effects resulting from the use of Zyprexa and (ii) the Company's decade-long illegal campaign to increase the volume of Zyprexa sales by marketing Zyprexa for off-label uses that were not approved by the FDA, in violation of FDA regulations that proscribe such marketing.
As a result of defendants' fraudulent business practices, sales of Zyprexa grew from $3.69 billion to $4.42 billion between 2002 and 2004, and the value of Company stock increased from $43.75 per share to $76.95 per share between July 18, 2002 and May 7, 2004. Throughout the Class Period, however, the defendants had access to internal information concerning a link between the use of Zyprexa and the adverse side-effects of extreme weight gain and diabetes.
Despite being faced with increasing independent research connecting Zyprexa to diabetes and weight gain, and the product liability actions by individuals who suffered these side-effects, the Company adamantly refused to acknowledge any wrongdoing. However, as various public agencies raised warnings about the safety of the use of Zyprexa, sales of the product plummeted and the Company's stock price dropped from $76.95 per share to $50.34 per share between May 7, 2004 and October 25, 2004 (amounting to a loss of market value of over $30 billion).
Subsequently, The New York Times published a series of articles between December 17 and 21, 2006, which revealed that Lilly had (i) engaged in a decade-long practice to minimize the health risks posed by the use of Zyprexa; and (ii) illegally marketed Zyprexa for off-label uses (such as to treat older patients for dementia) unapproved by the FDA.
As a result of the foregoing publications, the price of Lilly stock collapsed an additional $3.49 per share, or 6.4%, and amounted to a further loss of market value of approximately $3.5 billion.
If you are a member of the class described above, you may, not later than June 1, 2007, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Harwood Feffer, or other counsel of your choice, to serve as your counsel in this action.
Harwood Feffer has taken a leading role in many important actions on behalf of defrauded shareholders, employee investors and consumers and is responsible for hundreds of millions of dollars in recoveries. The Harwood Feffer website (www.hfesq.com) contains detailed information regarding this matter and additional information about the firm.
NOTICE: Although Harwood Feffer has not filed an action against the defendants, you may view a copy of the initial complaint, find more information about this and other matters, and obtain information about your rights by visiting the firm website (www.hfesq.com) or by contacting Jeffrey M. Norton at 877-935-7400 (ext. 286), Tanya Korkhov (ext. 207) or another firm representative.
More information on this and other class actions can be found on the Class Action Newsline at www.primenewswire.com/ca