The action alleges that during the class period, the defendants artificially inflated the price of Genta stock by concealing critical material information regarding the details of both the safety and efficacy of their lead product, Genasense, an antisense oligonucleotide molecule designed to block the production of a protein known as “Bcl-2.” The company claimed that increased expression of Bcl-2 appears to function as an important cause of the inherent resistance of cancer cells to chemotherapy.

The action alleges that the following facts were fraudulently concealed from the investing public: (1) that the company's Genasense study failed to show a survival benefit from the combination of Genasense plus dacarbazine using an unadjusted log rank analysis of survival time for the intention-to-treat population; (2) that as a result of missing data and the questionable manner in which the defendants arrived at their analysis of the secondary endpoints, they were required to perform a different procedure to account for the missing data; (3) that as a result of these analyses and further simulations conducted by FDA reviewers, it was clear that the defendants’ study was biased and fundamentally flawed; (4) that since most patients were asymptomatic at study entry and were EGOC performance status zero, it was difficult to assess whether patients achieved any symptom benefit from combination therapy over single-agent therapy; (5) that the addition of Genasense correlated with serious and alarming toxicity to patients during the study, and that toxicity increases were likely due to the addition of Genasense; (6) that at the May 3, 2004, meeting of the Oncologic Drugs Advisory Committee, the FDA would provide an accurate and transparent report of the concealed facts already described; and (7) that FDA regulations require “substantial evidence of efficacy” for any NDA and that no such finding could be made for Genasense since survival was not improved and toxicity was increased over the existing therapy.

The release of the FDA briefing materials on April 30, 2004, detailing the defendants’ concealment, followed by a recommendation to reject Genasense for malignant melanoma by an advisory panel caused Genta stock to drop as low as $5.11 from its class period high of $18.25, on volume of 48 million shares over two consecutive trading days.

If you purchased securities issued by Genta during the applicable period, you may request appointment by the court as a lead plaintiff if you do so by July 5, 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.