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The San Diego law firm of Johnson & Weaver announced on November 1 that it is filing a lawsuit against San Diego biopharmaceutical firm Vical, Inc.

The suit, intended to be a class action, alleges that Vical touted the importance and potential success of Allovectin, a cancer drug, indicating that it would receive approval from the Food and Drug Administration.

On August 12 the company revealed that Allovectin failed to provide efficacious results and tests would be terminated. That day, the stock plunged to $1.53 from its price the previous trading day of $3.58; it closed on November 1 at $1.26.

The company will not comment on the suit.

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Comments

Ponzi Nov. 2, 2013 @ 8:16 p.m.

Plunged from $3.58 to $1.53, try Amarin that plunged from $7.00 to $1.80. Biotech stock is the Baccarat of the Wall Street Casino. Stocks are complicated enough without adding a government layer like the FDA to the process. I also feel it's a corrupt process, the FDA listens to the Big Pharma lobbyists and kill small biotech's so they can be bought up later in break-up sales. I really have little knowledge of biotech's and steer clear of them in stocks.

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Don Bauder Nov. 3, 2013 @ 6:20 a.m.

Ponzi: Biotechs -- particularly those selling for very low prices like Vical -- are definitely a crapshoot. Some of the mature ones become something akin to blue chips, but still aren't really stable in price. Generally speaking, biotechs are not for small investors.

In many metro areas, it is a good idea to invest in hometown stocks that one can watch carefully. But San Diego is loaded with volatile biotechs. That advice doesn't really apply. Best, Don Bauder

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