Top court tosses suit against Theratechnologies

"The Supreme Court of Canada has tossed out a securities class-action lawsuit against Montreal-based drug company Theratechnologies Inc., in a ruling that some lawyers say could make it harder for plaintiffs across the country to file this kind of legal action."

"Theratechnologies found itself facing allegations that it failed to properly disclose issues around a new drug, called tesamorelin, after the U.S. Food and Drug Administration asked some questions in 2010 about potential side effects."

"Under most provinces’ securities legislation, shareholders who bought stock on the 'secondary market,' such as a stock exchange, need to get special permission from a judge to launch a securities class action, and must show that their case has a “reasonable possibility” of success."

"In the Thera case, lower courts in Quebec had given the go-ahead to securities class action lawsuit, which was launched on behalf of shareholders by a numbered holding company that held stock in the pharmaceutical firm and is owned by an investor named Roger St-Germain."

"But the Supreme Court ruled Friday that to pass this screening test, plaintiffs must provide 'sufficient evidence' to show a 'realistic chance' of success, although this stage of such cases must not balloon into a miniature trial."

From +The Globe and Mail

Top court tosses suit against Montreal drug firm Thera
Securities class actions need ‘realistic’ chance of success to proceed to trial, Supreme Court rules

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