b'allegations did not cure the deficiencies the court had identified in dismissing the amended complaint. First,In particular, the company expressly the proposed second amended complaint took issuedisclosed that the OS results were with a new statement from Tesaros November 2016 10-Q that the companys balance of cash and cashincomplete when it reported them in equivalents, plus proceeds from a follow-on stockNovember of 2018, and also indicated that offering and cash from expected sales of Varubi, were expected to be sufficient to meet . existing cash flowit was working to gather additional OS data requirements and fund . existing operations at theiron as many . patients as possible. This, currently planned level. The court reasoned that this statement was virtually identical to a statement theaccording to the court, adequately apprised court had already rejected as a basis for liability, andinvestors that the OS data were not final.thus could not plausibly support plaintiffs claims. The court further held that another similar statement added to the proposed new complaint from the November 2016 registration statement would likewise have beendisease stops progressing after treatment, it was also futile because (1) plaintiffs assume[d] a theory alreadydesigned with OS as a secondary endpoint. The study rejected by the court (i.e., that Tesaros sole motiva- was initially designed to enroll 351 subjects who would tion for the secondary offering was that it lacked suffi- either be administered tivozanib or the competitor drug, cient funds to continue its operations), and (2) the state- with the number of participants later dropping to 322. ment did not raise the requisite strong inference ofIn June of 2017, AVEO announced plans to conduct scienter. Finally, the court concluded that the proposedtopline analysis of 255 [PFS] events through the study, amendment to include a statement from a confidentialbut by October of 2018, announced that it would ana-witness claiming that only the companys most senior-lyze only 242 events due to the slow pace of events. level executives had been involved in the decisionAVEO also claimed in the October 2018 announcement to conduct the November 2016 offering was similarlythat this drop would not significantly alter the compa-futile. This statement, at most, plausibly alleged that thenys interpretation of the studys results. AVEOs stock individual defendants were involved in the decision toprice dropped by 10% in response to the October 2018 conduct a second public offering, but that this aloneannouncement. Despite AVEOs prior announcement was not indicative of a high degree of recklessnessthat the topline readout would be available in ear-with respect to the alleged falsity of the statements atly 2018, the topline analysis was not conducted until issue. The court denied plaintiffs motion for leave toNovember 2018, as a result of a slowdown in PFS file the second amended complaint, and dismissed theevents throughout 2018. After the topline analysis case with prejudice. No appeal was filed.was completed, AVEO disclosed in a November 2018 press release and investor call that tivozanib had met its primary endpoint of demonstrating a statistically Hackel v. AVEO Pharmaceuticals, Inc.significant benefit in PFS. AVEO also reported initial et al., Case No. 19-cv-10783 (ADB), 2020OS results, but stated that OS data would not be ma-WL 4274542 (D. Mass. July 24, 2020)ture until almost a year later. In January 2019, AVEO Anticipated Study Timelines and Results announced it would delay submitting tivozanib for FDA approval until it had more mature OS data. The com-AVEO Pharmaceuticals, Inc. (AVEO) is a biopharma- panys stock price dropped another 60% on the day of ceutical company that develops targeted medicinesthis announcement. for cancers and other diseases, including its primaryAVEO investors filed a putative class action complaint drug candidate, tivozanib, a once-daily oral medicationagainst AVEO and certain of its executives in February for the treatment of renal cell carcinoma. Tivozanib has2019 in the Southern District of New York, which was been referred to by AVEOs executives as the centrallater transferred to the District of Massachusetts. In July focus of the companys strategy. In May 2016, AVEO2019, plaintiffs filed their amended complaint, alleging announced the start of a new Phase 3 clinical trial forviolations of Sections 10(b) and 20(a) of the 1934 Act tivozanib, designed to compare the drug to a drugand Rule 10b-5 promulgated thereunder based on al-sold by one of its competitors. The study was meant tolegedly false and misleading statements in connection address FDA concerns about overall survival (OS) thatwith the companys efforts to demonstrate tivozanibs were identified in a previous study. AVEO announcedeffectiveness. Plaintiffs identified two categories of that, although the primary endpoint of the study wasstatements as being materially false and misleading: to measure progression-free survival (PFS), whichstatements about the timing by which topline data measures how long a patient lives and for how long thewould be available for analysis, and statements 17'