This is a securities fraud class action brought on behalf investors who purchased Vaxart, Inc. (“Vaxart” or the “Company”) securities between June 25, 2020 and August 19, 2020, inclusive (the “Class Period”). The action alleges claims under the federal securities laws against Vaxart, a clinical-stage vaccine developer, its senior executives, Board members, and controlling shareholder Armistice.
Commenced by Hagens Berman on August 24, 2020 after conducting an extensive investigation, the case arises from Defendants’ alleged fraudulent scheme to profit from artificially inflating the Company’s stock price by announcing false and misleading information concerning Vaxart’s oral COVID-19 vaccine candidate. Specifically, the Complaint alleges that on June 26, 2020, Vaxart issued a press release entitled, “Vaxart’s COVID-19 Vaccine Selected for the U.S. Government’s Operation Warp Speed,” falsely claiming its vaccine had been selected to participate in a non-human challenge study, organized and funded by OWS. This announcement sent the price of Vaxart shares rocketing higher.
The complaint alleges that, in furtherance of the scheme, Defendants amended controlling shareholder Armistice’s existing warrant agreements, allowing Armistice to exercise all of its warrants immediately and sell 27.6 million Vaxart shares, reaping profits of approximately $200 million. Defendants also issued millions of dollars in favorable stock options to Vaxart’s most senior executives.
On July 25, 2020, the truth emerged when The New York Times published an article entitled, “Corporate Insiders Pocket $1 Billion in Rush for Coronavirus Vaccine,” covering suspiciously timed stock bets that had generated significant profits for senior executives and board members at companies developing vaccines and treatments. Vaxart was featured prominently in the article, and it clarified “Vaxart is not among the companies selected to receive significant financial support from Warp Speed.” In response to this news, the price of Vaxart shares dropped sharply, injuring investors.
