SAN DIEGO–(BUSINESS WIRE)–Robbins Geller Rudman & Dowd LLP (http://www.rgrdlaw.com/cases/reckitt/) today announced that a class action has been commenced by an institutional investor on behalf of purchasers of Reckitt Benckiser Group plc (OTCMKTS:RBGLY) American Depositary Shares (“ADSs”) during the period between July 28, 2014 and April 9, 2019 (the “Class Period”). This action was filed in the District of New Jersey and is captioned City of Sterling Heights Police & Fire Retirement System v. Reckitt Benckiser Group plc, et al., No. 19-cv-15382.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Reckitt ADSs during the Class Period to seek appointment as lead plaintiff. A lead plaintiff acts on behalf of all other class members in directing the litigation. The lead plaintiff can select a law firm of its choice. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at [email protected]. You can view a copy of the complaint as filed at http://www.rgrdlaw.com/cases/reckitt/.
The complaint charges Reckitt and certain of its current and former officers and directors with violations of the Securities Exchange Act of 1934. Reckitt is a consumer and healthcare company based in the United Kingdom. Prior to December 2014, the Company maintained a division dedicated to opioid addiction treatments known as Reckitt Benckiser Pharmaceuticals Inc. (“Reckitt Pharma”). For many years, Reckitt Pharma’s primary source of revenue was the manufacture and sale of Suboxone Tablets, a treatment for opioid addiction.
The complaint alleges that before and during the Class Period, Reckitt and its most senior executives perpetrated a scheme, which generated over $3 billion in proceeds, to facilitate opiate abuse among U.S. consumers and mislead investors and the public regarding the health and safety risks of Reckitt’s new key opiate product, Suboxone Film. Specifically, the complaint alleges that in order to maintain and grow profits, senior executives at Reckitt devised a plan to switch prescribers from Suboxone Tablets to the Company’s new proprietary treatment, Suboxone Film. Suboxone Film had similar active ingredients to Suboxone Tablets, however it was dispensed in a thin film placed under the tongue and stored in single-use foil wrappings. Executives planned to create a marketing campaign that touted the purported safety benefits of Suboxone Film over Suboxone Tablets in order to prevent generic competition. Key to this campaign was fabricating safety concerns with existing treatments in order to delay the entry and approval of generics for Suboxone Tablets. Defendants’ scheme to fraudulently inflate sales of Suboxone Film was a success. Between 2010 and 2014, the Company’s revenues from sales of the drug increased ten-fold to over $840 million annually. As a result of defendants’ false and misleading statements and/or omissions regarding the scheme to inflate sales of Suboxone Film during the Class Period, Reckitt ADSs traded at artificially inflated prices.
The truth began to leak out on July 24, 2017, when the Company announced, in connection with its second quarter 2017 financial results, that it had recorded a £318 million charge related to ongoing U.S. Department of Justice and U.S. Federal Trade Commission investigations into its former Reckitt Pharma operations. On this news, the price of Reckitt ADSs dropped 5%. Then, on February 19, 2018, Reckitt announced, in connection with its full year 2017 financial results, that it had recorded an exceptional charge of £296 million due to the investigations, and that the investigations now also involved the California Department of Insurance. On this news, the price of Reckitt ADSs declined more than 10%. Finally, on April 9, 2019, the DOJ filed a criminal indictment against Reckitt Pharma (now known as Indivior), which detailed a multi-billion-dollar scheme to defraud the public and the Company’s investors through the marketing and sale of Suboxone Film. On this news, the price of Reckitt ADSs again declined over 6%. Ultimately, Reckitt agreed to settle the federal investigations into its marketing and sale of Suboxone Film for $1.4 billion. At the time, the settlement was called the “largest opioid settlement in US history.”
Plaintiff seeks to recover damages on behalf of all purchasers of Reckitt ADSs during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.
Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities litigation. With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history. For six consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements. Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims. Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide. Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry. Please visit http://www.rgrdlaw.com for more information.
Robbins Geller Rudman & Dowd LLP
Darren Robbins, 800/449-4900 or 619/231-1058