Securities Class Action Filed Against Akorn, Inc.
Violations of federal securities laws as a result of a series of materially false statements. The Complaint alleges that: (1) as of December 31, 2014, more than eight months after it acquired Hi-Tech Pharmacal Co., Inc. and four months after it acquired VersaPharm Incorporated, Akorn had not yet integrated those subsidiaries into its centralized accounting department and accounting systems; (2) certain data related to Hi-Tech and VersaPharm could not be timely collected and compiled; (3) due to these delays, the Company would be unable to timely complete its assessment of the effectiveness of its internal control over financial reporting as of December 31, 2014; and (4) weaknesses existed relating to the completeness and accuracy of underlying data used in the reporting of its financial results and disclosures in its Form 10-K. It is alleged that, despite these circumstances, on February 26, 2015, the Company announced its preliminary fourth quarter and full year 2014 results, in which it touted strong performance for the quarter and highlighted accomplishments relating to these acquisitions. Raj Rai, Akorn’s Chief Executive Officer, added that “2014 was a transformative and rewarding year for Akorn.” However, just days later, on March 2, 2015, the Company issued a press release announcing that it would need an extension to file its annual report for the year ending December 31, 2014 because it “experienced unforeseen delays in collecting and compiling certain financial and other related data that would be included in the Form 10-K relating to the VersaPharm and Hi-Tech Pharmacal subsidiaries which were not integrated into the Company’s centralized accounting department and accounting systems as of December 31, 2014.” As a result of this news, shares of Akorn fell from $53.71 on March 2, 2015 to close at $49.33 on March 3, 2015, a loss of value of more than 8%. Filed in N.D. Ill.
Lead Plaintiff Deadline: The deadline to file for lead plaintiff in this action is 5/4/2015.
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