Several class actions have been filed against biotechnology company Cerus Corporation (Nasdaq: CERS) and certain of its officers and directors by stockholders who purchased the company's common stock between October 25, 2000, and September 3, 2003. The actions claim 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.

The action alleges that, during the applicable period, Cerus caused its stock to be artificially inflated by issuing a series of misleading statements about the company's development program for the Intercept Blood System for Red Blood Cells (Intercept RBC), a system that applies Helinx technology for the treatment of red blood cell concentrates.

Cerus allegedly claimed that its Helinx technology for the treatment of RBC concentrates was represented by a family of novel small molecules that could target and crosslink nucleic acids of pathogens. The company allegedly claimed that when S-303, one of the novel Helinx compounds, was added to blood or blood components, it would cross through cell walls or viral membranes, and then bind to and crosslink these foreign nucleic acids (DNA or RNA). Cerus allegedly claimed that this action prevented the replication of the undesired viruses, bacteria and other pathogens, cutting off their capacity to cause infection. It also claimed that since red blood cells do not contain nuclear DNA or RNA, S-303 and other Helinx compounds could be safely added to red blood cell concentrates.

Cerus allegedly advertised that its Helinx technology represented a selective and targeted approach to the inactivation of the undesired viruses, bacteria and other pathogens and a way to assure the safety of the blood supply. On May 17, 2001, when Cerus stock had inflated to a price of $59 per share, the company sold $78 million of its own securities via a secondary offering. On June 6, 2003, Cerus again sold an additional $54.3 million of its own securities. The individual defendants allegedly took advantage of the inflated value of Cerus stock to sell their own shares for proceeds of over $5.8 million.