The action alleges that, during the applicable period, the defendants disseminated materially false and misleading information regarding Adolor’s flagship product candidate Entereg and its trials for Entereg for the management of postoperative ileus. The defendants allegedly concealed from the investing public that a number of its trials failed, particularly those that included patients treated for simple hysterectomy, indicating that the drug might be ineffective for certain projected uses. To compound this, the action alleges the company wrongfully represented that it was unable to make meaningful comparisons between different Entereg trials, further hiding the fact that the drug had failed in certain applications. Had the defendants revealed the extent to which they were aware of the problems, the action alleges that investors would have been spared the harm they suffered when the news finally broke.

On November 12, 2003, as shares traded at prices as high as $18.14, the company sold 6,900,000 shares of its common stock for gross proceeds of approximately $119 million. On January 13, 2004, Adolor finally reported the bad news about the third in its series of Phase III clinical trials for its new drug application submission. On this news, the price of Adolor’s stock plunged 37%, trading as low as $13.73 per share, on an unprecedented volume of 12.7 million shares.

If you purchased securities issued by Adolor during the applicable period, you may request appointment by the court as a lead plaintiff if you do so by June 21, 2004. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that your claim is typical of the claims of other class members, and that you will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiffs. Your ability to share in any recovery is not affected by the decision whether or not to serve as a lead plaintiff. You may retain any counsel of your choice to serve as you in this action, or you may choose to do nothing, and remain in the class as a silent member.