ST. LOUIS (CN) - KV Pharmaceutical officers made false statements about the company's compliance with federal regulations, stockholders say in a federal class action.
Named plaintiff Joseph Mas says the false statements centered on certain generic drug products and KV's financial prospects.
On Nov. 11 KV announced that it would not be able to file its Form 10-Q for the second fiscal quarter because of a continuing investigation of management misconduct, the lawsuit states. Two days later, KV announced that an Audit Investigation Committee was looking at generic product recalls; KV released several undisclosed setbacks related to product erosion, discontinued products and manufacturing delays. As a result, its stock price fell nearly 59 percent, from $14.26 a share to $5.90.
The class consists of all buyers of KV publicly traded securities between Feb. 15 and Nov. 12 this year. The class is represented by Don Lolli of Kansas City. KV's CEO Marc S. Hermelin and CFO Ronald Kanterman are also named as defendants.