Phi Finney McDonald acts for the Lead Plaintiff and Group Members in a class action against Mayne Pharma Group Limited (MYX; MYPHY) (Mayne) commenced in the Supreme Court of Victoria on behalf of investors who acquired shares in Mayne (traded on the Australian Securities Exchange) between 24 November 2014 and 15 December 2016 (inclusive) (claim period). Vannin Capital, a global litigation funder, is providing funding for the class action.
Background
This class action follows the announcement on 15 December 2016 that the Attorney General of Connecticut had commenced anti-trust civil proceedings against a number of pharmaceutical companies, including Mayne Pharma Inc., Mayne’s US subsidiary (Mayne USA). It is alleged in that proceeding that Mayne USA, along with other defendants, participated in a conspiracy to restrain trade, inflate the price of generic pharmaceuticals, and reduce competition.
The market responded strongly to this information, with Mayne’s share price falling around 10% over the following trading days.
Allegations
The proceeding alleges that Mayne:
(a) contravened its continuous disclosure obligations between 24 November 2014 and 15 December 2016 (inclusive) by failing to properly inform the market:
- beginning from a date in or after July 2013, Mayne’s US subsidiary (Mayne USA) entered into, and continued, discussions, and by no later than on or about 24 November 2014 entered into an agreement, with Heritage Pharmaceuticals Inc. in relation to the sale of Doxycycline Hyclate Delayed Release (Doxy DR) which were anti-competitive within the meaning of relevant United States statutory provisions, or likely to be so regarded by relevant stakeholders and/or US regulators;
- upon receiving a subpoena from the US Department of Justice, and later a separate subpoena from the Attorney General for the State of Connecticut, that Mayne was reasonably likely to face civil or criminal action in relation to the Heritage Anti-Competitive Information with exposure criminal and civil penalties in the USA and associated reputational damage.
(b) engaged in misleading and deceptive conduct between 24 November 2014 and 15 December 2016 (inclusive) by representing that it:
- was it fact compliant with, and had in place, effective policies, procedures and systems for ensuring compliance with, competition law (including US competition law) and the letter and spirit of the law;
- was not exposed, or alternatively, meaningfully exposed to risk of reputational damage or risk of criminal and civil penalties in the US for failure to comply with US competition law.
The class action alleges that investors who acquired Mayne shares during the Claim Period are entitled to compensation for loss and damage as they paid more for those shares than they would have paid as a consequence of Mayne’s conduct. The class action also alleges that some group members would not have purchased Mayne Shares if Mayne had complied with its obligations.