Scios Nova Will Defend Itself In Shareholder Lawsuit

Scios Nova has been named as a defendant in a series of lawsuits alleging violations of the federal securities laws in connection with the company's statements on Auriculin (anaritide), under development for the treatment of patients with acute renal failure. The suits were filed in the US District Court for the Northern District of California on May 18 and 19, purportedly on behalf of investors who purchased the company's stock between October 6, 1993, and May 2, 1995. Also named as a defendant is the company's chairman and chief executive, Richard Casey.

Mr Casey said that lawsuits such as this "have become a predictable occurrence for dynamic technology-based companies," and "we at Scios Nova have consistently met our obligations under the securities laws, and we will continue to do so. We intend to defend this lawsuit vigorously, and are confident that we will prevail."

Preliminary results of a Phase III trial with Auriculin were released recently (Marketletter May 8), and these were disappointing, in that the product showed no statistically significant effect over placebo. These results mean that Scios Nova will be unable to meet its objective of filing for approval for Auriculin this year.