A class action has been filed against chemical and pharmaceutical manufacturer Cambrex Corporation (NYSE: CBM) and certain of its officers and directors by stockholders who purchased the company's common stock between October 21, 1998, and July 25, 2003. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock.

On January 23, 2003, Cambrex shocked investors when it announced that it had overstated its net income by $5 million due to improper accounting from 1997 to 2001, and that it would restate its financial results for the five-year period. Moreover, throughout the class period, the defendants allegedly failed to disclose that the Securities and Exchange Commission had commenced an informal investigation into the company's improper accounting. Additionally, the action alleges that during the class period, the defendants issued false and misleading statements, including profit warnings, that failed to disclose the loss of a major contract between Cambrex and Transkaryotic Therapies, Inc. to manufacture the drug Replagal to treat Fabry disease, and the effect of the loss on Cambrex's financial prospects.