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Incyte Corporation Message Board

  • jacosa jacosa Apr 5, 2013 11:16 AM Flag


    A short break from personal abuse.

    While there are several lawsuits, they all seem to be about the same thing. It is claimed that Incite management committed a wrong that can be relieved by the court when they misled investors about the Jakafi business. Frankly, I don't understand the legal theory.

    To mislead people, I think it's obvious that you have to misrepresent the past, the present or the future. I'm not aware of any restatements of financial measures, so I don't see how you could win a case claiming that the past was misrepresented. I clearly recall that there were statements during the sell-in of Jakafi that much of the business was prescriptions to non-study patients of investigators from the study: that is exactly where the glitch developed, but the fact was disclosed. So the present was fairly described. Misrepresentations about the future seem to be protected by the safe harbor boilerplate. Yeah, it's an easy step from "sicker patients are getting our drug in the wild than got it in our studies" to "a lot of the current patients won't be getting our drug for vary long," but management doesn't appear to be legally obliged to make that step. Furthermore, they had logic alone, but no evidence on which to draw such a conclusion. FDA jumps down your throat and pulls you inside out for statements that go beyond the evidence.

    What ACTUALLY drove the stock down last Summer, and what strikes me as a possible tort, was that management conducted a conference call with inadequate preparation, it showed, and they got humiliated. Thing is, to make that something that you could get a recovery for, you'd have to show that either they were outside the normal range of management incompetence, or that they did it on purpose. Neither seems possible, so the suits claim misleading statements.

    I'm curious. Any legal sharpies able to show why law firms think they have a chance to collect? (case citations are helpful if accompanied by quick summaries)

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    • Too much lawyer bashing and too much worrying about lawsuits. Management may have made some misleading statements about immediate financial prospects. People make mistakes, and learn from them. Lawsuits such as these are an important check on the system. That being said, most of these lawyer announcements are nothing more than advertsements soliciting clients. Those lawyers then refer cases to the few law firms actual filing cases. At the end of the day if INCY pays out 10 or 20 million for this purported mistake, the stock will literally drop only a few cents. This is almost a 3 billion dollar market cap company and paying out a few million bucks is not going to substantially move the stock price, This is a complete and total non-issue.

      Sentiment: Strong Buy

      • 1 Reply to trigfest99
      • Well said. I lived through one of the biggest recall lawsuits in a decade while in pharma management, and other class action law suits related to one adverse event or another with other companies. In all cases the stock rebounded firmly and events became ancient history. These are just a shareholder lawsuits based upon potentially misleading comments made by some executives. They are insignificant. I checked similar companies in the past who faced similar circumstances and the consequences were insignificant. Drug efficacy and safety are not even involved here. Smart people know this and realize things like this are a natural part of the business environment. That is why I am going to add another .5 to my position before the shorts cover. I imagine they don't like paying the interest. I am long with INCY and plan to ride this out, like all the other times...

        Sentiment: Strong Buy

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