More than two years after a slate of patient deaths in a clinical trial, cancer immunotherapy company Juno Therapeutics is poised to settle a class action lawsuit over its handling of the incident.
Seattle-based Juno, now part of biotech giant Celgene, and three of Juno’s top executives, including former CEO Hans Bishop, agreed to a settlement that includes a $24 million payout to certain Juno stockholders. The parties agreed to the settlement in July, but it will not be finalized until a hearing in federal court on Nov. 16.
The lawsuit, brought on behalf of stockholders, alleged that Juno and the named executives misled investors by withholding information related to patient deaths in the clinical trial of its most advanced drug, called JCAR015.
The drug is a kind of cancer immunotherapy that genetically re-engineers a patient’s immune cells to find and destroy cancer. Others like it have successfully wiped out the disease in terminal patients. JCAR017, Juno’s current focus, has found success in early trials.
In the lawsuit, the plaintiffs say that the first of the patient deaths had important implications for JCAR015’s future. It was the first sign of possible safety problems with the drug, problems which led the FDA to suspend the trial twice, both of which sent Juno’s stock value plummeting.
But the company did not notify investors of the first patient death until about a month after it happened, after two other patients also died.
After investigating the deaths, Juno removed a secondary drug thought to have caused them and continued the trial. When two more patients died in November, the FDA suspended the trial once more. Juno finally pulled the drug in March of 2017.
The lawsuit is a prime example of the challenges facing companies that develop these cutting-edge therapies. The science around immunotherapy treatments like Juno’s is still developing, including our understanding of the side effects that could have caused the deaths of these patients.
As part of the settlement, anyone who acquired Juno stock between June 4, 2016 and Nov. 22, 2016, is eligible for a payout. The terms of the settlement say it is not an admission of wrongdoing on the part of Juno or the executives named in the lawsuit, including Bishop, Juno’s current chief medical officer Mark Gilbert and its chief financial officer Steven Harr.
Since pulling JCAR015, Juno has continued to pursue other, similar treatments. The company was acquired by biotech giant Celgene for $9 billion in January, after which Bishop left the CEO role and joined Celgene’s board of directors.
Read the full terms of the settlement below:
Juno Therapeutics Class Action Lawsuit Settlement by GeekWire on Scribd
