LITTLE ROCK, Ark., March 23, 2001 (PRIMEZONE) -- The Law Firm of Cauley Geller Bowman & Coates, LLP announced today that it has filed a class action in the United States District Court for the District of New Jersey on behalf of all individuals and institutional investors that purchased the common stock of Schering-Plough Corporation ("Schering-Plough" or the "Company") (NYSE:SGP) between July 25, 2000 and February 15, 2001, inclusive (the "Class Period").
The complaint charges the Company and certain of its officers and directors with violations of federal securities laws by issuing materially false and misleading information that misrepresented the Company's financial condition and prospects. Specifically, the complaint alleges that during the Class Period, Schering-Plough issued three earnings releases highlighting the Company's purported success and growth. The complaint alleges that these three releases contained statements that were materially false and misleading because they failed to disclose certain material facts, including, inter alia:
(a) that the Company was experiencing manufacturing difficulties at
its plants in Union, N.J., Kenilworth, N.J., Manati, Puerto Rico
and Las Piedras, Puerto Rico, such that it was distracted from
producing products at the levels budgeted for the respective
plants;
(b) that the company's manufacturing policies and procedures at its
plants in Union, N.J., Kenilworth, N.J., Manati, Puerto Rico and
Las Piedras, Puerto Rico, did not comply with applicable FDA
regulations regarding the manufacture of pharmaceutical
products;
(c) that the Company's manufacturing problems were more widespread
and severe than the previously-announced problems at the aerosol
plant;
(d) given the Company's manufacturing difficulties, the risk that
the FDA would force the Company to curtail its operations and
delay FDA approval of desloratadine so that the Company could
correct the problems was much greater than defendants had
disclosed; and
(e) that based on past practices and policies of the FDA and the
nature and extent of the identified deficiencies, it was certain
that the FDA would conduct a follow-up inspection of the New
Jersey facilities.
The complaint further alleges that defendants' failure to disclose the extent of its exposure to its manufacturing problems, falsely implied that there were no known impediments to receiving approval for its most-important new drug, desloratadine, which was in the final stage of the FDA's review process. Desloratadine, which is to be marketed as Claritin, is scheduled to be the successor drug to Claritin, once the patent for Claritin expires in December 2002.
The complaint charges that as a result of defendants' misleading statements and failure to disclose material information, the price of Schering-Plough securities was artificially inflated throughout the Class Period. Additionally, defendants and certain Company insiders took advantage of the inflated stock prices to dump $41.3 million of their own shares on unsuspecting investors.
After the market had closed on February 15, 2001, Schering-Plough finally disclosed the extent of the problems it was experiencing with its manufacturing practices and announced that it would be reducing sales and earnings expectations for the first quarter of 2001 and for the full-year 2001. The Company also warned that the FDA was requiring that all of its manufacturing deficiencies be resolved before the FDA would grant final approval of desloratadine.
Wall Street was shocked by the Company's 2/15/01 announcement. In extremely heavy after-hours trading, the price of Schering-Plough common stock fell nearly $10 per share, after closing earlier in the day at $48.32. On February 16, 2001, the day after the announcement, Schering-Plough's common stock opened up for trading at $38.25.
Cauley Geller Bowman & Coates, LLP has substantial experience representing investors in securities fraud class action lawsuits such as this. The firm has offices in Florida, Arkansas and California, but represents shareholders from throughout the nation. If you have any questions about how you may be able to recover for your losses, or if you would like to consider serving as one of the lead plaintiffs in this lawsuit, you must meet certain requirements and take appropriate action by April 17, 2001. You are encouraged to call or e-mail the Firm or visit the Firm's Website at www.classlawyer.com.
CAULEY GELLER BOWMAN & COATES, LLP
Sue Null, Charlie Gastineau or Jackie Addison
P.O. Box 25438
Little Rock, AR 72221
Toll Free: 1-888-551-9944
E-mail: info@classlawyer.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca