Pomerantz Appointed Co-Lead Counsel in Talis Biomedical Securities Litigation
On June 3, 2022, U.S. District Judge Susan Illston of the Northern District of California appointed Pomerantz LLP as Co-Lead Counsel on behalf of Leon Yu and Max Wisdom Technology Limited – Co-Lead Plaintiffs in the case – and the class, in Modrak v. Talis Biomedical Corporation, 22-cv-105 (N.D. Cal.). This securities action alleges that Talis Biomedical Corporation ("Talis" or the "Company") failed to disclose deficiencies in the testing of its Talis One COVID-19 test (“Talis One”) and the resulting delays with its application to the U.S. Food and Drug Administration (“FDA”) for Emergency Use Authorization (“EUA”).
Talis is a medical manufacturing company that focuses on creating “point of care” diagnostic testing devices for the treatment of infectious diseases including COVID-19. The Company issued its IPO in February 2021, raising $232.6 million in capital.
Allegations against Talis include that the Company failed to disclose that: (i) questionable methods were used in the initial studies of Talis One; (ii) due to this, Talis would be unlikely to obtain EUA for Talis One from the FDA; and (iii) as a result, commercialization of Talis One would also be delayed.
The truth began to emerge on March 8, 2021, when Talis announced that it had withdrawn its EUA for Talis One, revealing that “[i]n late February, the FDA informed the company that it cannot ensure the comparator assay used in the primary study has sufficient sensitivity to support Talis’s EUA application.” As a result, the Company intended to “initiate its previously planned clinical validation study in a point-of-care environment” to submit its EUA application “early in the second quarter of 2021.” Talis also revealed that the study “was designed with a different comparator study, which Talis believes will address the FDA’s concerns.”
On this news, Talis’ share price fell $1.80 per share, or 12%, to close at $12.85 per share on March 8, 2021.
Then, on August 10, 2021, Talis revealed that its “development timelines have been extended by delays in the launching of [Talis’] COVID-19 test and manufacturing scale.” As a result, the Company expected to see “[its] first meaningful revenue ramp in 2022.”
On this news, Talis’ share price fell a further $0.58 per share, or 6%, to close at $8.39 per share on August 11, 2021.
On August 30, 2021, after the market closed, Talis announced that its Chief Executive Officer (“CEO”), Brian Coe (“Coe”), had “stepped down” as President, CEO, and Director.
On this news, Talis’ share price fell a further $1.00 per share, or 11%, to close at $8.06 per share on August 31, 2021.
Finally, on November 15, 2021, Talis announced that Brian Blaser (“Blaser”) was appointed as President, CEO, and Director of Talis, effective December 1, 2021. However, just a week after his appointment, on December 8, 2021, the Company announced that Blaser had stepped down from his positions.
On this news, Talis’ share price fell a further $0.55 per share, or more than 11%, to close at $4.28 per share on December 8, 2021.
Between the withdrawal of the EUA application in March 2021 and the announcement of Blaser’s resignation in December 2021, Talis’ share price suffered a 71% decline.