US fraud class action filed against Able Labs

A securities fraud class action complaint has been filed in the US District Court of New Jersey against generic drugmaker Able Laboratories on behalf of investors who acquired securities in the firm between October 30, 2002 and May 18, 2005.

The complaint alleges that, during the period, Able made a series of materially false and misleading statements on its business and earnings, failing to disclose that product testing procedures failed to meet standard industry practices and good manufacturing practices established by the US Food and Drug Administration

The lead counsel in the case, Chitwood Harley Harnes, also claims that Able was faced with potentially large liabilities and fines as a result of its standard breaches, which jeopardized not only its current offerings, but also the likelihood that drugs in development would gain approval. As a result, its current and future earnings lacked a reasonable basis, the law firm stated.