Securities Fraud Lawsuit Filed Against Cabaletta Bio, Inc. (CABA)
A securities fraud lawsuit has been filed against Cabaletta Bio, Inc. (NASDAQ: CABA) for potential securities violations on behalf of shareholders who purchased shares anytime (i) pursuant and/or traceable to the offering documents issued in connection with the Company’s initial public offering conducted on or about October 24, 2019; and/or (ii) between October 24, 2019 and December 13, 2021, both dates inclusive. The release of potentially misrepresentative and misleading information, as well as failure to disclose material adverse facts to the public may have resulted in material losses for shareholders. The class action lawsuit has already been filed.
Lawsuit Filed Against Cabaletta Bio
Allegations Against CABA
Cabaletta Bio’s lead product candidate is DSG3-CAART. This is presently in Phase I clinical trial for the treatment of mucosal pemphigus vulgaris, an autoimmune blistering skin disease, and Hemophilia A with Factor VIII alloantibodies. Pursuant to its IPO conducted on or about October 24, 2019, Cabaletta Bio sold approximately 6.8 million shares of common stock priced at $11.00 per share, for approximate proceeds of $69.5 million.
On December 14, 2021, Cabaletta Bio issued a press release “report[ing] top-line data on biologic activity from the two lowest dose cohorts in the DesCAARTes™ Phase 1 clinical trial of DSG3-CAART for the treatment of patients with mucosal Pemphigus Vulgaris (mPV).” Among other results, Cabaletta Bio reported that two cohort participants had “disease activity scores . . . that worsened . . . after DSG3-CAART infusion” and thus “reduced or discontinued selected systemic therapies prior to DSG3-CAART infusion, as required by the protocol”, while another participant “subsequently received systemic medication to improve disease activity after DSG3-CAART infusion.” On this news, Cabaletta Bio’s stock price fell by more than 73%, damaging investors.
Misleading Statements Alleged
The complaint against Cabaletta Bio alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that:
- Top-line data of the Phase 1 Clinical Trial indicated that DSG3-CAART had, among other things, worsened certain participants’ disease activity scores and necessitated additional systemic medication to improve disease activity after DSG3-CAART infusion;
- accordingly, DSG3-CAART was not as effective as the Company had represented to investors;
- therefore, the Company had overstated DSG3-CAART’s clinical and/or commercial prospects; and
- as a result, the Company’s public statements were materially false and misleading at all relevant times.
What Should You Do?
If you purchased shares of Cabaletta Bio common stock during the relevant time period, you may be entitled to compensation, without payment of any out-of-pocket litigation fees or costs. You may request the Court to appoint you as lead plaintiff for the class action no later than April 29, 2022. Should you be designated as the lead plaintiff, you would have discretion over the litigation, including approval of a final settlement amount. We urge investors to contact us immediately to discuss this. MDF Law PLLC, is a New York City based law firm whose practice focuses on advocating for investors. Our attorneys have helped recover hundreds of millions of dollars for our clients. We take all our cases on contingency, which means we do not collect a legal fee unless our clients recover money. Contact MDF Law for a free consultation regarding this issue.