Gray v. Biogen Inc. et al

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
FRANCES CLARITY STOKES and
THOMAS ALLEN GRAY, individually and
on behalf of all others similarly situated,
Plaintiffs,
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Civil Action No. 1:24-cv-12691-IT
v. 	*
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BIOGEN INC., CHRISTOPHER A.
VIEHBACHER, MICHEL VOUNATSOS,
MICHAEL R. MCDONNELL, and PRIYA
SINGHAL,
Defendants.
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MEMORANDUM & ORDER
March 26, 2026
TALWANI, D.J.
In this securities fraud putative class action suit, Plaintiffs bring claims against
Defendants Biogen Inc. (“Biogen”) and its President and Chief Executive Officer Christopher A.
Viehbacher, former President and Chief Executive Officer Michel Vounatsos, Executive Vice
President and Chief Financial Officer Michael R. McDonnell, and Executive Vice President and
Head of Development Priya Singhal (collectively, the “Individual Defendants”) for alleged
violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78j
and 78t, and Rule 10b-5, 17 C.F.R. § 240.10b-5.
Pending before the court is Defendants’ Motion to Dismiss Amended Complaint [Doc.
No. 48] for failure to plead any materially false or misleading statements or any facts that
support a compelling inference of scienter under Section 10(b) and Rule 10b-5 (Count I) or
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“control person” liability under Section 20(a) (Count II). Id. at 1-2. For the reasons stated herein,
Defendants’ Motion to Dismiss [Doc. No. 48] is GRANTED.
I. 	Procedural Background
In May 2024, Plaintiff Thomas Allen Gray, individually and on behalf of a putative class
that acquired Biogen stock between February 3, 2022, and February 13, 2024, filed a Class
Action Complaint for Violation of the Federal Securities Law (“Complaint”) [Doc. No. 1]
against Biogen and three of the Individual Defendants in the U.S. District Court for the District
of Colorado. Gray certified that, on July 20, 2023, he purchased eight shares of Biogen stock at
$274.93 per share. Compl. at ECF 44 [Doc. No. 1].
On July 22, 2024, Frances Clarity Stokes moved for appointment as Lead Plaintiff. Mot.
for App’t as Lead Pl. 1–2 [Doc. No. 7]. Stokes certified that, on February 23, 2023, she
purchased 220 shares of Biogen stock at $272.40 per share. Decl. of Jeremy A. Lieberman, Ex.
3, at ECF 3 [Doc. No. 8-3]. Based on the average closing prices of Biogen’s stock from February
14 through May 13, 2024, Stokes estimated her loss to be $12,645. Lieberman Decl., Ex.. 1
[Doc. No. 8-1].
The assigned Magistrate Judge granted the motion and appointed Stokes as Lead Plaintiff
for the putative class. Order 6 [Doc. No. 24]. On October 21, 2024, the Magistrate Judge granted
Defendants’ unopposed motion to transfer the case to this court pursuant to 28 U.S.C. § 1404.
Order 4–5 [Doc. No. 29].
Lead Plaintiff Stokes and Plaintiff Gray filed their First Amended Class Action
Complaint for Violations of the Federal Securities Laws (“Amended Complaint”) [Doc. No. 43]
on December 31, 2024, adding Priya Singhal as an Individual Defendant, more than doubling the
putative class period, and significantly expanding their allegations. Plaintiffs assert that, between
September 14, 2020 (more than two years and five months before the first purchase of shares by
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either Stokes or Gray) and November 14, 2024 (almost five months after the original Complaint
[Doc. No. 1] was filed), Defendants made over fifty false or misleading statements that induced
Plaintiffs to acquire Biogen stock at artificially inflated prices and suffer economic harm when
the price of that stock fell. See id. ¶¶ 1–2, 224–316. Defendants then filed the pending Motion to
Dismiss [Doc. No. 48] Plaintiffs’ Amended Complaint [Doc. No. 43] under Federal Rule of Civil
Procedure 12(b)(6).
II. 	Standard of Review
When evaluating a motion to dismiss for failure to state a claim, the court assumes “the
truth of all well-pleaded facts” and draws “all reasonable inferences in the plaintiff's favor.”
Nisselson v. Lernout, 469 F.3d 143, 150 (1st Cir. 2006). To survive dismissal, a complaint must
contain sufficient factual material to “state a claim to relief that is plausible on its face.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007). “While a complaint attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual allegations . . . [f]actual allegations must be
enough to raise a right to relief above the speculative level . . . .” Id. at 555 (internal citations
omitted). “A claim has facial plausibility when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
“Exhibits attached to the complaint are properly considered part of the pleading for all
purposes, including Rule 12(b)(6).” Trans-Spec Truck Service, Inc. v. Caterpillar Inc., 524 F.3d
315, 321 (1st Cir. 2008) (internal citations and quotations omitted). The court may, in limited
circumstances, consider documents not attached to a complaint “[w]hen the complaint relies
upon a document, whose authenticity is not challenged[.]” Alt. Energy, Inc. v. St. Paul Fire &
Marine Ins. Co., 267 F.3d 30, 33 (1st Cir. 2001) (citation omitted); see also Clorox Co. P.R. v.
Proctor & Gamble Com. Co., 228 F.3d 24, 32 (1st Cir. 2000) (on a motion to dismiss,
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considering advertising materials not included with the complaint because they were “integral”
to assessing complaint’s allegations of false advertising); Lydon v. Local 103, Int’l Bhd. of Elec.
Workers, 770 F.3d 48, 53 (1st Cir. 2014) (in ruling on a motion to dismiss, “a judge can mull
over ‘documents incorporated by reference in [the complaint], matters of public record, and other
matters susceptible to judicial notice.’”) (citation omitted).
Courts addressing motions to dismiss in securities fraud cases governed by the Private
Securities Litigation Reform Act (“PSLRA”), 15 U.S.C. § 78u-4, routinely consider financial
statements and transcripts that a complaint incorporates by reference. See, e.g., Fire & Police
Pension Ass’n of Colo. v. Abiomed, Inc., 778 F.3d 228, 232 n.2 (1st Cir. 2015); In re Biogen Inc.
Sec. Litig., 193 F. Supp. 3d 5, 13 n.2 (D. Mass. 2016), aff’d, 857 F.3d 34 (1st Cir. 2017). A
complaint incorporates a document by reference where the allegations are “expressly linked to–
and admittedly dependent upon–a document (the authenticity of which is not challenged)” such
that the “document effectively merges into the pleadings and the trial court can review it in
deciding a motion to dismiss under Rule 12(b)(6).” Beddall v. State St. Bank & Trust Co., 137
F.3d 12, 17 (1st Cir. 1998); see also Alt. Energy, Inc., 267 F.3d at 33.
Securities fraud allegations are held to heightened pleading requirements under Federal
Rule of Civil Procedure 9(b) and the PSLRA. 15 U.S.C. § 78u–4(b)(2). See In re Boston Sci.
Corp. Sec. Litig., 686 F.3d 21, 27, 30 (1st Cir. 2012); N. Am. Catholic Educ. Programming
Found., Inc. v. Cardinale, 567 F.3d 8, 15 (1st Cir. 2009) (holding that the particularity
requirement applies not only to actual fraud claims but also to “associated claims where the core
allegations effectively charge fraud”). As with all allegations of fraud, a securities fraud claim
must be dismissed unless it “state[s] with particularity facts giving rise to a strong inference that
the defendant acted with the required state of mind.” 15 U.S.C. § 78u–4(b)(2).
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III. 	Factual Background
A. 	The Parties
Plaintiffs assert that their purchases of Biogen securities during the putative class period,
as detailed above, were at “artificially inflated prices.” Am. Compl. ¶ 6. [Doc. No. 43].
Biogen is a biotechnology company that develops and commercializes pharmaceuticals.
Id. ¶ 23. It focuses largely on drugs for the treatment of neurological conditions, including
multiple sclerosis (“MS”) and Alzheimer’s disease (“AD”). Id. Biogen’s common stock is traded
on the NASDAQ Global Select Market under the ticker “BIIB.” Id. ¶ 7.
Defendant Vounatsos was Biogen’s President and Chief Executive Officer and a member
of Biogen’s Board of Directors from January 2017 to November 2022. Id. ¶ 8.
Defendant Viehbacher has served as Biogen’s President and CEO and as a member of
Biogen’s Board of Directors since November 2022. Id. ¶ 9.
Defendant McDonnell has served as Biogen’s Executive Vice President and Chief
Financial Officer since August 2020. Id. ¶ 10.
Defendant Singhal served as Biogen’s Senior Vice President and Head of Global Safety
& Regulatory Sciences from February 2020 to January 2022, and as interim Head of
Development from January 2022 to January 2023. Id. ¶ 11. She has served as Biogen’s Executive
Vice President and Head of Development since January 2023. Id.
B. 	Events Prior to the Putative Class Period
1. 	Tecfidera
In 2013, Biogen sought and received approval from the U.S. Food and Drug
Administration (“FDA”) for Tecfidera, an oral medication for the treatment of MS. Am. Compl.
¶¶ 24–25 [Doc. No. 43]. By 2018, annual sales of Tecfidera were $4.3 billion and accounted for
thirty-five to forty percent of Biogen’s global product sales. Id. ¶ 27.
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In 2015, a former Biogen sales representative’s qui tam complaint was unsealed. Id.
¶ 366. The relator alleged that Biogen “paid illegal kickbacks to physicians to prescribe its MS
products, including Tecfidera, over competing products in violation of the False Claims Act and
state law counterparts.” Id.
In 2017, generic pharmaceutical manufacturers began challenging Biogen’s Tecfidera-
associated patents and initiated Abbreviated New Drug Applications (“ANDAs”), seeking FDA
approval for generic versions of Tecfidera. Id. ¶¶ 55–56. In 2020, after Biogen lost a series of
patent suits initiated by these generic manufacturers, “at least eight generic versions” of
Tecfidera entered the market. Id. ¶¶ 90–91.
2. 	Vumerity
On November 17, 2017, Biogen announced its agreement to purchase the rights to an MS
drug in development, later known as Vumerity. Am. Compl. ¶ 59 [Doc. No. 43]. Vumerity is a
bioequivalent of Tecfidera, relying on the same “mechanism of action in the human body” as
Tecfidera to treat MS but containing a different active ingredient. Id. Vumerity was protected
under three distinct patents through 2033 and therefore not subject to competition arising from
generic ANDA filings. Id. ¶ 60. Biogen sought to rapidly bring Vumerity to market. Id. ¶ 64.
In October 2019, Biogen received FDA approval for Vumerity and “directed [its] sales
associates in the United States to switch as many patients as possible from Tecfidera to Vumerity
once they could market it.” Id. ¶ 67. By June 2020, Biogen’s monthly unit sales of Vumerity had
reached only 50,225 capsules, or the equivalent of 419 thirty-day supplies of Vumerity. Id. ¶ 159.
That number was only two percent of the 2,495,616 capsules of Tecfidera, or approximately
41,594 thirty-day supplies, sold at the time. Id.
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3. 	Biogen’s Agreement to Develop Leqembi
In March 2014, Biogen entered into an agreement (the “2014 agreement”) with Japanese
pharmaceutical company Eisai Co., Ltd. (“Eisai”). Am. Compl. ¶ 77 [Doc. No. 43]. Under the
2014 agreement, Biogen and Eisai would “jointly develop” two drugs currently under study at
Eisai for the treatment of AD, including Leqembi. Id. ¶¶ 77, 80. The 2014 agreement also
permitted Eisai to opt into collaboration with Biogen on its AD products in development,
including another drug known as Aduhelm. Id. ¶ 77.1
At the time Biogen and Eisai entered into the 2014 agreement, Eisai had completed a
successful Phase 1 clinical trial of Leqembi and had recently initiated a Phase 2 clinical trial. See
id. ¶¶ 32, 77. Under both the 2014 agreement and an amended Collaboration Agreement signed
in 2017 (the “2017 agreement”), Eisai was the “primary lead for the development of [Leqembi],
including clinical trial management and regulatory filings.” Id. ¶ 79.
In March 2019, Eisai announced the initiation of an eighteen-month Phase 3 clinical trial
for Leqembi (the “Phase 3 trial”). Id. ¶ 165. Before initiating treatment with either Leqembi or a
placebo, Eisai tested each Phase 3 trial participant to determine if the participant was a carrier of
the “ApoE4 allele.” Id. ¶ 183. Individuals with ApoE4 are thought to be at a higher risk of
developing AD and, as Biogen stated on the warning label for Aduhelm, a higher incidence rate
for “Amyloid Related Imaging Abnormalities” (“ARIA”). Id. ¶ 183.2 ARIA is “a serious and
1 Plaintiffs’ Amended Complaint [Doc. No. 43] includes detailed allegations involving Biogen’s
development of Aduhelm. See, e.g., id. ¶¶ 77–80, 93–115. Plaintiffs’ claims do not directly
involve Biogen’s statements or omissions regarding Aduhelm, however, and the court references
Aduhelm only as necessary for context.
2 Plaintiffs also cite to a November 2021 article published in the Journal of the American
Medical Association, entitled “Amyloid-Related Imaging Abnormalities in 2 Phase 3 Studies
Evaluating Aducanumab with Early Alzheimer Disease.” Id. ¶ 110. The article stated that
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sometimes fatal condition seen in AD patients involving transient legions in the brain that
present as ‘abnormalities’ on MRIs.” Id. ¶ 109. ARIA may cause edema or hemorrhage in the
brain and lead to “seizures, strokes, or death.” Id.
Eisai intended to run subgroup analyses on the ApoE4 carrier population enrolled in the
Leqembi Phase 3 trial. Id. ¶ 183.
C. 	Events During the Putative Class Period (September 14, 2020––November 14,
2024)
1. 	Industry Positioning, MS Drug Competition, and Pharmacy Benefit Managers
Biogen relied on pharmacy benefit managers (“PBMs”), which function as “middlemen”
between drug manufacturers and health plans, to sell Tecfidera and other products to patients.
Am. Compl. ¶¶ 117, 120 [Doc. No. 43].
PBMs often enter “rebate agreements” with pharmaceutical manufacturers, under which
the manufacturer provides the PBM with a post-sale rebate per eligible unit sold. Id. ¶¶ 128–29.
Pharmaceutical manufacturers use rebates to incentivize PBMs “to either place a branded drug
on a better tier of the PBM’s standard formularies than any generics of that drug or simply
exclude the generics from those formularies altogether.” Id. ¶ 130.
Through rebate contracts with PBMs, Biogen sought to “disadvantage or exclude generic
Tecfidera” from PBM formularies. Id. ¶ 146. Biogen paid to PBMs an average Tecfidera rebate
of 19% in 2020, 45% in 2021, and 28% in 2022. Id. ¶ 148. In 2021, “more than 45% of the 300
million Americans with pharmacy benefit coverage were subject to formularies that did not give
generic Tecfidera any better tier placement than Tecfidera[,]” despite generic Tecfidera’s lower
“roughly 40% of participants” in the two Aduhelm Phase 3 trials conducted by Biogen “had
suffered from ARIA, and one-quarter of those patients were symptomatic.” Id.
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price. Id. ¶ 153.3 Although generic Tecfidera was “deeply discounted” relative to brand-name
Tecfidera,4 generic Tecfidera represented less than a third of all sales by June 2021. Id. ¶ 158.
Pharmaceutical rebate agreements attracted regulatory attention, including a U.S. Federal
Trade Commission (“FTC”) investigation announced on June 7, 2022.5 During a public FTC
hearing on June 16, 2022, an FTC Commissioner’s statement was read aloud, including the
Commissioner’s position that “today’s statement may appear to focus on pharmacy
middlemen—PBMs—but the statement very much focuses on PBMs and manufacturers.” Id.
¶ 320. The FTC also issued a press release that day, in which it announced the agency’s intention
to “ramp up enforcement against any illegal bribes and rebate schemes that block patients’ access
to competing lower-cost drugs.” Id. Quoting the FTC Chair, the press release warned that
“today’s action should put the entire prescription drug industry on notice.” Id. Between the close
of trading on June 15 and June 16, 2022, Biogen’s stock price declined from $197.26 per share to
$191.53 per share. Id. ¶ 321.
On July 20, 2022, Biogen announced that it had reached a $900 million settlement in the
aforementioned qui tam case. Id. ¶ 370.
3 Plaintiffs also point to the relative positioning of Tecfidera and generic Tecfidera on the three
largest American PBMs’ formularies (OptumRx, CVS Caremark, and Express Scripts) between
2020 and 2022. Id. ¶¶ 149–51.
4 Plaintiffs compare manufacturer Mylan’s generic Tecfidera, which Mylan introduced in August
2020, as one such example. Id. ¶ 156.
5 At the time of the announcement, the FTC also released a “model copy” of the orders issued to
six PBMs, which included requests for “documents relating to formulary design for ‘Rebated
Drug Products,’ defined to include ‘dimethyl fumarate (Tecfidera).’” Id. ¶ 318.
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2. 	Leqembi Development
a. 	The Continuing Phase 3 Trial and FDA Accelerated Approval
As previously noted, the Leqembi Phase 3 trial began in March 2019. Am. Compl. ¶ 165
[Doc. No. 43]. Eighteen months later, Eisai initiated the thirty-month open label extension
(“OLE”) phase of the trial, in which Phase 3 trial patients “who were on placebo [were
permitted] to switch to Leqembi if they chose to do so.” Id.
On May 6, 2022, Eisai sought “accelerated” FDA approval for Leqembi based on study
data from the Phase 2 trial. Id. ¶ 168. The FDA agreed to review the Phase 2 trial data “as a
surrogate endpoint reasonably likely to predict a clinical benefit” under the accelerated approval
process and later use the Phase 3 trial data to verify any such clinical benefit. Id.
On January 6, 2023, the FDA granted accelerated approval for Leqembi based on the
Phase 2 trial data, and Eisai filed a supplemental application for traditional FDA approval based
on the Phase 3 trial data. Id. ¶ 176. Also on January 6, Eisai issued a press release announcing
that Leqembi would be priced at $26,500 and explaining its pricing rationale. Id. ¶ 177.
The FDA granted full approval for Leqembi on July 6, 2023, but included a “black box”
warning regarding the “uncommon but potentially serious side effect of ARIA.” Id. ¶ 180. Later
that day, the Centers for Medicare & Medicaid Services (“CMS”) announced that the agency
would cover the cost of Leqembi at the standard 80% Medicare rate but would require Medicare
patients to “enroll[] in a registry to monitor real world treatment” with Leqembi. Id. ¶ 181.
b. 	Patient Deaths During the Phase 3 Open Label Extension
While Eisai was obtaining FDA approval based on Phase 2 trial data, three patients died
during the Phase 3 OLE.
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i. 	Patient 1
Patient 1, an eighty-eight-year-old male, received a placebo during the core Phase 3 trial
but shifted to Leqembi during the OLE. Id. ¶ 185. He was not an ApoE4 carrier, but he was
taking prescribed blood thinners. Id.
On May 18, 2022, after reporting a recent fall, Patient 1 underwent an MRI that
“ultimately showed that he had ARIA-E [ARIA causing edema] and ARIA-H [ARIA causing
hemorrhage].” Id. On June 12, 2022, Patient 1 died “after suffering both a heart attack and four
mini-stroke-like events.” Id. In a mandatory adverse event report filed with the FDA, the Phase 3
trial investigator listed Patient 1’s death as “related” to Leqembi. Id. ¶ 186.
Eisai requested that the Phase 3 trial’s data and safety monitoring board (the “board”)
“look into” any relationship between anticoagulant use and heightened ARIA risk. Id. ¶ 187.
After concluding that 3.1% of all patients in the Phase 3 trial using anticoagulants developed
macrohemorrhages but only 0.46% of patients not on anticoagulants experienced the same, the
board requested that Eisai add language to the trial consent forms expressly warning patients
about this risk. Id. ¶ 187. Eisai did so on July 14, 2022. Id. The board did not recommend that
Eisai exclude patients on anticoagulants from the Phase 3 trial. Id.
ii. 	Patient 2
Patient 2, a sixty-five-year-old female who possessed two copies of the ApoE4 allele,
received a placebo during the core Phase 3 trial study but transitioned to taking Leqembi as part
of the OLE in August 2022. Id. ¶ 189.
On September 3, 2022, Patient 2 arrived at an emergency room after “display[ing]
garbled speech.” Id. Emergency room providers diagnosed Patient 2 with an ischemic stroke and,
upon ordering a CT scan, “found . . . clear evidence of ARIA.” Id. When a blood thinner was
administered to Patient 2, she suddenly developed hypertension and “began screaming and
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writhing in pain, requiring doctors to chain her to the gurney, induce a coma, and, eventually,
administer a reversing treatment.” Id.
Patient 2 suffered “extensive bleeding on the outer layer of her brain” and passed away
several days later. Id. Subsequent MRI and CT scans “showed ‘innumerable’” ARIA areas in
Patient 2’s brain. Id.
Patient 2’s husband reported Patient 2’s death and the surrounding circumstances “to the
contract research organization who administered Leqembi to Patient 2 and, ultimately, to Eisai”
through a meeting with the trial investigator assigned to Patient 2. Id. ¶ 190.
iii. 	Patient 3
Patient 3, a seventy-nine-year-old female who possessed two copies of the ApoE4 allele,
received a placebo during the core Phase 3 trial but started receiving Leqembi in August 2022 as
part of the OLE. Id. ¶ 192. After starting on Leqembi, Patient 3 reported experiencing headaches.
Id.
On September 14, 2022, Patient 3 was taken to a hospital to be evaluated for a possible
seizure. Id. While hospitalized, Patient 3 was administered a blood thinner for treatment of atrial
fibrillation. Id.
“Brain scans” performed at the hospital “confirmed multifocal swelling and 51
microhemorrhages, consistent with ‘severe’ ARIA” in Patient 3’s brain. Id. On September 19,
Patient 3 suffered multiorgan failure and passed away. Id. At the time, the trial investigator
assigned to Patient 3 filed an adverse event report with the FDA, in which Patient 3’s seizure was
“preliminarily” classified as “related” to Leqembi. Id. ¶ 193.
Eisai disagreed with the “related” classification based on Patient 3’s seizure risk factors,
including her age and underlying AD. Id.
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c. 	Initial Reporting on the Phase 3 Trial Following these Deaths
On September 27, 2022, Eisai and Biogen published a press release announcing “positive
top line results” from the Phase 3 trial, including that the study “met the primary endpoint by
reducing clinical decline on the [relevant cognitive scale] by 27% compared with placebo.” Am.
Compl. ¶ 169 [Doc. No. 43].
On November 29, 2022, Eisai presented detailed results of the Phase 3 trial at an industry
conference, with an October 22, 2022 data cutoff for the ongoing OLE component of the trial. Id.
¶ 204. During that presentation, Eisai reported two deaths during the OLE. Id. Based on the
descriptive information included in its public presentation, the two study participant deaths
reported by Eisai were those of Patient 1 and Patient 2. See id. ¶¶ 185–90, 204.
Eisai described both deceased patients as having displayed “concurrent
macrohemorrhage” at the time of death.” Id.6 Eisai further stated that there was “no clear
relationship of macrohemorrhage to ApoE4 status, baseline MRI, or timing of treatment” and
that subjects taking anticoagulant medication could continue in the open label extension “with
informed consent language regarding increased risk of cerebral hemorrhage with concomitant
anticoagulant use.” Id.
Biogen and Eisai also published a press release that day, in which the companies
disclosed that Leqembi’s “ARIA incidence profile was within expectations based on the Phase 2
trial results” but reported one death in the placebo participant group and two deaths in the
Leqembi participant group during “the [Phase 3] core study and subsequent [OLE] study.” Id.
6 In an accompanying slide, Eisai described the deaths as follows: “1 case of macrohemorrhage
in 65F E4 homozygous [for ApoE4] after tPA for left MCA occlusion (OLE) and 1 case in 87M
E4 non-carrier [of ApoE4] on apixaban (stopped) then received heparin [an anticoagulant
medication] for MI (OLE), cause of death cardiopulmonary)[.]” Id.
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¶ 283. With respect to the two participant deaths, both of which occurred during the OLE study,
the release stated: “Both cases had significant comorbidities and risk factors including
anticoagulation contributing to macrohemorrhage or death. Therefore, it is Eisai’s assessment
that the deaths cannot be attributed to [Leqembi].” Id.
Also on November 29, 2022, Eisai published a peer-reviewed paper in the New England
Journal of Medicine that purported to include detailed results of the Phase 3 trial. See id. ¶¶ 174,
206. The paper “did not discuss any [of] the deaths during the OLE period[,]” described in
greater detail infra. Id. ¶ 206.
d. 	Autopsy Results
A brain autopsy on Patient 1, performed on November 18, 2022, indicated that Patient 1
“suffered an intracerebral hemorrhage and that there was extensive ARIA at the site of the
hemorrhage.” Am. Compl. ¶ 188 [Doc. No. 43].
An autopsy of Patient 2 was performed “no later than the end of 2022.” Id. ¶ 194. The
pathologist who performed the autopsy, Confidential Witness 6 (“CW6”), discovered “brain
swelling” and “frayed blood vessels.” Id. The trial investigator who filed an adverse event report
with the FDA listed Patient 2’s death as “related” to Leqembi and noted that Patient 2’s death
was “a highly unusual case” in which the ARIA detected during autopsy were “not otherwise
described in humans and suggest a host response to anti-amyloid beta therapy.” Id. ¶ 191. Eisai
disagreed that Patient 2’s death was related to Leqembi and attributed her death to her age or the
administration of a blood thinner while Patient 2 was undergoing treatment in the emergency
room. Id.
CW6 concluded that Patient 2 suffered not from a stroke, but from “stroke-like symptoms
of brain damage” and ultimately died from “multifocal intracerebral hemorrhage due to Leqembi
infusion complicated by the fact that she appeared to have a stroke, leading to the use of [the
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blood thinner].” Id. ¶ 194. CW6 offered to share the full details of Patient 2’s autopsy with Eisai
on two occasions but was rebuffed. Id. ¶ 195.
An autopsy of Patient 3 “coordinated” by Confidential Witness 7 (“CW7”), a board-
certified vascular neurologist, was performed in March 2023. Id. ¶¶ 18, 196. During the autopsy,
“more than 30 microbleeds” were discovered in Patient 3’s brain. Id. ¶ 196. The autopsy results
also included findings of “widespread inflammation [in Patient 3’s brain] . . . with areas of
‘necrotic’ tissue, and blood vessels that appeared shredded and deformed.” Id. The results
supported the conclusion that Patient 3’s cause of death was “‘necrotizing vasculitis’ related to
treatment with Leqembi.” Id.
In either late March 2023 or early April 2023, CW7 sent Patient 3’s autopsy reports to a
journalist “who, in turn, sent a copy to Eisai’s public relation department.” Id. ¶ 197. CW7 also
sent copies of the autopsy report to “numerous scientists who work with Eisai and ‘senior
executives’ at Eisai” and offered to send “all materials, including tissue slides, so Eisai and
Biogen could review them.” Id. Eisai’s response, in CW7’s recollection, was “‘very slow, very
limited, and did not occur in a timeframe when it might be helpful to the FDA approval
process.’” Id.7
7 Plaintiffs further allege that following review of the autopsy report:
Eisai concluded as follows: “Given the findings of edema and microhemorrhages
and considering the short latency to onset following the initiation of the open label
extension and the subject’s APO4 homozygous [two gene] status increasing the risk
for ARIA events, the events of possible cerebral edema is classified as ‘Related’ to
study medication” and, given the relationship between ARIA-E and seizures,
classified the seizure as “Related” to Leqembi as well.
Id. ¶ 198.
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e. 	Further Reporting
In light of the observation of ARIA during the Phase 3 study, Eisai performed additional
analysis on data from a subset of Phase 3 study participants to compare ARIA rates in
participants taking blood thinners to the rates in those not taking blood thinners (the “subset
study”). Am. Compl. ¶¶ 290, 292 [Doc. No. 43]. In March 2023, Biogen and Eisai issued a press
release reporting the results of the analysis. Id. ¶ 290. In sum, although ARIA rates were higher
in those receiving Leqembi than those receiving a placebo in the overall study, Eisai found in the
subset study that
The risks of ARIA appear slightly higher in the placebo group with antiplatelet or
with 	anticoagulants 	relative 	to 	placebo 	subjects 	not 	on 	anticoagulants 	(no
antiplatelet 	or 	anticoagulation: 	8.9%, 	antiplatelet: 	9.7%, 	anticoagulation
(anticoagulation alone or with antiplatelet): 10.8%). ARIA rates may be slightly
lower in those on lecanemab treated with antiplatelet or with anticoagulation,
relative to lecanemab treated subjects not with antiplatelet or with anticoagulation
(no antiplatelet or anticoagulation: 21.8%, antiplatelet: 17.9%, anticoagulation:
13.3%).
Id. Biogen and Eisai also stated that, in the Phase 3 overall study, ARIA “did not occur more
frequently in [Leqembi]-treated participants on antiplatelet or anticoagulant drugs compared to
[Leqembi]-treated participants that were not on either.” Id. On April 25, 2023, during Biogen’s
quarterly earnings call, Defendant Singhal referred to these results during her prepared remarks
and, in her response to an analyst question later on, stated that Eisai “[did not] believe that the
overall conclusions [regarding the safety of Leqembi for those with two copies of the ApoE4
gene] are different in terms of [the Phase 3 study] and confidence in the data.” Id. ¶ 293.
3. 	Commercial Launch of Leqembi and Further FDA Action
After receiving FDA approval and a CMS Medicare coverage determination “no later
than July 6, 2023,” Biogen and Eisai introduced Leqembi into the marketplace. Am. Compl.
¶¶ 180, 211 [Doc. No. 43]. Between the FDA’s accelerated Leqembi approval in January 2023
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and April 2023, Biogen’s newly appointed CEO, Defendant Viehbacher, made various
statements concerning “capacity restrictions” at “infusion centers” where Leqembi would be
administered and with respect to MRIs8 for patients who began taking Leqembi. Id. ¶ 214.
On May 15, 2023, the CEO of Eisai’s United States business announced during a
conference call that, “by the end of fiscal year 2023,[9] [Eisai] expect[s] about 10,000 patients to
be on [Leqembi] by that time. . . . [i]n the United States.” Id. ¶ 217. On September 11, 2023,
while speaking at an industry conference, Viehbacher stated, “I think nothing that we’re seeing
says that the Eisai guidance can’t be met, which is 10,000 patients by the end of their fiscal year,
which is the end of March.” Id. ¶ 303; see id. ¶ 304 (quoting Viehbacher’s assertion at the same
conference that “in some ways, having the target at the end of [Biogen’s] first quarter [in March
2024] is more of a relevant benchmark . . .”).
On August 22, 2023, the FDA’s Deputy Director of Global Regulatory Strategy wrote to
Eisai’s Director of Regulatory Strategy that:
[S]ince Leqembi was approved on January 6, 2023, we have become aware of
clinical trial data showing an increased risk of symptomatic, serious, and severe
amyloid relating imaging abnormalities (ARIA) in ApoE4 homozygotes who are
treated with Leqembi compared to heterozygotes and noncarriers. . . . [and] data
showing 	intracerebral 	hemorrhage 	that 	includes 	findings 	on 	neuroimaging
suggestive of cerebral amyloid angiopathy (CAA) and use of anticoagulants.”
Id. ¶ 210. Because the FDA considered this data to be new information, the agency required
Eisai to conduct additional clinical trials for Leqembi. Id.
In November 2023, Viehbacher publicly stated that 800 patients had been prescribed
Leqembi at that point in time and again referred to the 10,000 patient goal. Id. ¶ 306.
8 As publicly stated by Viehbacher, “in the first 14 weeks [of taking Leqembi], [a patient]
probably need[s] [three] MRIs according to [Leqembi’s] label.” Id. ¶ 214 (quotations omitted).
9 Eisai’s 2023 fiscal year ended in March 2024. See id. ¶ 303.
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While speaking at an industry conference on January 8, 2024, Viehbacher’s update on
Leqembi’s rollout included that “we’ve probably got a target of 10,000 [patients], and we’re
working our way through that.” Id. ¶¶ 308–09. Also on that date, Viehbacher made additional
public statements contextualizing the 10,000 patient goal, including that the goal was an attempt
to “give people some sort of milestone” because there were “no real analogues for this launch,”
the 10,000 patient goal was an indication of expected “trajectory,” and, although “there is no
reason to say, that, we can’t get there[,]” the “data were kind of choppy in December. So, for me,
I am really looking for the January [2024] data. But where we are right now is, 10,000 isn’t
really what we are interested in anymore. It’s how do we now get to the 100,000?” Id. ¶ 322.
On February 13, 2024, on its quarterly conference call, an Eisai officer stated that
reaching the 10,000 patient goal by March 2024 would be “challenging” and that “there are
approximately 4x greater number of patients on the waiting list than the current number of
patients receiving the treatment,” or 8,000 waiting list patients. Id. ¶ 324. During Biogen’s
quarterly conference call later that day, Viehbacher stated that there were “approximately 2,000
patients on [Leqembi] therapy at the moment” and expressed Biogen’s belief that the company
was making “very solid progress” with respect to Leqembi, particularly in reference to Eisai’s
“belief . . . that for all the patients on [Leqembi] treatment, they [sic] are at least three or fourfold
of those who are actually in waiting rooms.” Id. ¶ 315. Viehbacher reported that there were 3,800
patients expected to receive, but not yet prescribed, Leqembi. Id. ¶ 325.
4. 	Government Actions, Criticisms of Leqembi, and Further Statements from Eisai
in the Second Half of 2024
On July 23, 2024, the Chair of the U.S. House Committee on Oversight and
Accountability released a report on PBM contracting practices. Am. Compl. ¶ 328 [Doc. No. 43].
The report stated, inter alia, that “evidence suggests that decisions were often made based on the
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economics of a medication, other than its benefit to patients or affordability,” citing as support
“Express Scripts First Production” on April 6, 2023. Id. Those documents included “documents
addressing ‘Tecfidera.’” Id.
On July 26, 2024, the European Union’s European Medicines Agency (“EMA”) publicly
released “highlights” from its Committee for Medicinal Products for Human Use’s (“CHMP”)
meetings to consider regulatory approval of Leqembi. Id. ¶ 330. In doing so, the EMA made
public that CHMP recommended denying the request for Leqembi’s market authorization and
did so, at least in part, because Leqembi’s therapeutic effect did not “counterbalance the risk of
serious adverse events,” including the risk of ARIA. Id. ¶ 331.
In September 2024, the FTC issued an administrative complaint charging the three largest
PBMs with, inter alia, violations of Section 5(b) of the FTC Act, 15 U.S.C. §§ 41–58, with
respect to the listing of insulin and insulin biosimilars on PBM-developed formularies. Id.
¶¶ 132, 139–40. The FTC press release accompanying the filing of the administrative complaint
on September 20, 2024, warned that “all drug manufacturers should be on notice that their
participation in the type of conduct challenged here raises serious concerns, and that the Bureau
of Competition may recommend suit [of] drug manufacturers in any future enforcement
actions[.]” Id. ¶ 334.
On September 23, 2024, the FTC publicly released its administrative complaint. Id.
¶ 336. In that complaint, the FTC alleged that PBMs’ “demand for larger rebates has also inflated
list prices for other critical drugs including treatments for autoimmune diseases and
inflammatory conditions.” Id. Plaintiffs state that MS, for which Tecfidera is prescribed, is “both
an autoimmune and inflammatory condition.” Id.
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On October 16, 2024, the Therapeutic Goods Administration (“TGA”), Australia’s
regulating entity for pharmaceuticals, announced that it, too, would deny approval for Leqembi.
Id. ¶ 338. In its announcement, TGA considered “the frequent occurrence of [ARIA] in patients
treated with Leqembi” and concluded that Leqembi’s therapeutic effect was not significant
enough to “outweigh the associated safety risks.” Id.
On October 23, 2024, The New York Times published an article in which it reported that
Eisai did not inform Phase 3 trial participants who tested positive for ApoE4 that their risk of
developing ARIA was elevated. Id. ¶ 340. The article also noted a previously unreported
Leqembi-associated ARIA death that occurred after Leqembi became available on the public
market. Id. As reported in the article, “several” Phase 3 trial participants “dropped out because of
severe ARIA soon after receiving Leqembi, which Eisai confirmed were ‘related’ to Leqembi,
according to adverse event reports reviewed by The Times.” Id.
On November 8, 2024, Eisai released its quarterly financial report and revised its full-
year Leqembi revenue forecast from $370 million to $280 million. Id. ¶ 342. Eisai also reported
that 4,000 patients in the United States were currently taking Leqembi, “with another 6,000
eligible to start treatment.” Id. When asked about the outlook for Leqembi during a quarterly
conference call, Eisai’s CEO advised that the company did not expect Leqembi to become
profitable until the 2026 fiscal year. Id.
On November 14, 2024, the EMA announced that, upon reevaluation, CHMP
recommended approving Leqembi for patients who “have only one or no copy of ApoE4,” as
those patients had a reduced risk of developing ARIA. Id. ¶ 346. The EMA also warned,
however, that Leqembi must not be used by individuals taking anticoagulants due to an increased
risk of developing hemorrhagic ARIA. Id.
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Also on November 14, 2024, the FDA revised its approved label for Leqembi. Id. ¶ 346.
The new label limited Leqembi to individuals “with one or no copy of ApoE4” given the higher
risk of ARIA development in individuals with two ApoE4 copies and included new language
about additional risks for Leqembi patients who also used blood thinners. Id.10
IV. 	Count I – Violation of Section 10(b) of the Exchange Act and Rule 10b-5
To state a claim for securities fraud under Section 10(b) and Rule 10b-5, a plaintiff must
sufficiently allege six elements:
(1) a device, scheme, or artifice employed to defraud; a material misrepresentation
or omission; or an act, practice, or course of business which operates or would
operate as a fraud or deceit upon any person; (2) scienter, or a wrongful state of
mind; (3) a connection with the purchase or sale of a security; (4) reliance; (5)
economic loss; and (6) loss causation.
Zhou v. Desktop Metal, Inc., 120 F.4th 278, 287 (1st Cir. 2024) (citations omitted).
For each of the challenged statements, as to the first element, Plaintiffs allege either
material misrepresentations or omissions. Defendants challenge the sufficiency of those
allegations as well as Plaintiff’s scienter allegations.
A. 	Materially False Misstatements or Omissions
The fifty-six statements challenged by Plaintiffs can be grouped into three categories: (1)
statements about Biogen’s sales of Tecfidera and Vumerity; (2) statements about Leqembi’s
safety profile; and (3) statements about Leqembi’s commercial prospects. The court will address
the categories in reverse order.
10 The new language included the following warning: “Fatal cerebral hemorrhage has occurred in
a patient taking an anti-amyloid monoclonal antibody in the setting of focal neurologic
symptoms of ARIA and the use of a thrombolytic agent.” Id.
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1. 	Statements About the Leqembi 10,000 Patient Goal
On May 15, 2023, the leader of Eisai’s United States division stated that “[b]y the end of
fiscal year 2023 [March 2024], we do expect about 10,000 patients to be on [Leqembi] by that
time. . . . [i]n the United States.” Am. Compl. ¶ 217 [Doc. No. 43]. Plaintiffs assert that Biogen
“expressly adopted [the 10,000 patient] figure no later than September 11, 2023,” through a
statement by Defendant Viehbacher at an investment conference. Id. Viehbacher made similar
statements in three other instances, including later at the same September 11 conference, on a
November 8, 2023 earnings call, and at a conference on January 8, 2024. See id. ¶¶ 303–304,
306, 309.
Defendants do not dispute that Biogen and Eisai failed to reach the 10,000 patient goal by
March 2024. See Mem. ISO Mot. to Dismiss 23 [Doc. No. 50]. Instead, Defendants argue that
the challenged statements are protected under the PSLRA’s “safe harbor,” as the statements
either “were both identified as forward-looking and accompanied by meaningful cautionary
language” or “not alleged to have been made with actual knowledge of falsity.” Id. at 21 (citing
15 U.S.C. § 78u–5(c)(1)).
The PSLRA’s “safe harbor” provision shields securities issuers from liability in private
actions based on false or misleading statements of material fact “with respect to any forward-
looking statement, whether written or oral” where the statement is
identified as a forward-looking statement, and is accompanied by meaningful
cautionary statements identifying important factors that could cause actual results
to differ materially from those in the forward-looking statement . . . or . . . the
plaintiff fails to prove that the forward-looking statement . . . [if made on behalf of
a business entity by or with the approval of an executive officer was] made . . . with
actual knowledge by that officer that the statement was false or misleading.
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In re Stone & Webster, Inc., Sec. Litig., 414 F.3d 187, 212 (1st Cir. 2005) (quoting 15 U.S.C.
§ 78u–5(c)(1)) (alteration in original); see In re Biogen Inc. Sec. Litig., 193 F. Supp. 3d at 39.
The statute defines “forward-looking statement[s]” to include
(A) a statement containing a projection of revenues, income . . . earnings (including
earnings loss) per share, . . . capital expenditures, dividends, . . . or other financial
items; (B) a statement of the plans and objectives of management for future
operations . . . ; (C) a statement of future economic performance . . . ; (D) any
statement of the assumptions underlying or relating to [any of the above].
In re Stone & Webster, 414 F.3d at 212 (quoting 15 U.S.C. § 78u–5(i)(1)) (alteration in original);
Hackel v. AVEO Pharms., Inc., 474 F. Supp. 3d 468, 473, 478 (D. Mass. 2020) (company’s
statements about what it “expected[,]” “anticipated[,]” or “target[ed][,]” with respect to the
timeline on which it would release topline data were “clearly forward looking”).
a. 	Statement of Present Fact
The court finds Viehbacher’s first challenged statement to be a statement of fact that is
not protected by the safe harbor but is nonetheless insufficient to state a claim.
Although the statement did reference Eisai’s, and by extension Biogen’s, future goal as to
the number of patients prescribed Leqembi, the statement also communicated Biogen’s present
impression, as of September 11, 2023, that the goal was attainable. See Am. Compl. ¶ 303 [Doc.
No. 43]) (“I think nothing that we’re seeing says that the Eisai guidance can’t be met, which is
10,000 patients by the end of their fiscal year, which is the end of March.” (emphasis added)).
Where the PSLRA’s safe harbor “is intended to apply only to allegations of falsehood as
to the forward-looking aspects of the statement[,]” In re Stone & Webster, 414 F.3d at 213, an
allegedly false or misleading aspect of the statement that is not forward-looking is not brought
under the safe harbor merely because it is accompanied by a forward-looking aspect. See id.; see
also N.J. Carpenters Pension & Annuity Funds v. Biogen IDEC Inc., 537 F.3d 35, 45 n.13 (1st
Cir. 2008) (“In analyzing a forward-looking statement, the aspect of the statement that is based
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on the present facts must be distinguished from the aspect of the statement that is a future
projection.”). Taking this necessary distinction into account, the court finds that this September
11, 2023 statement is not a forward-looking statement to which the PSLRA safe harbor applies.
See, e.g., Dahhan v. OvaScience, Inc., 321 F. Supp. 3d 247, 254 (D. Mass. 2018) (“Though the
estimate that OvaScience would achieve 1,000 cycles is forward-looking, the element of
Defendants’ statements that pertained to the status of Defendants’ current expectations or status
were not forward looking, and are not protected by the safe harbor.”).
Nevertheless, Plaintiffs have failed to allege facts to support their claim that Defendants
knew this statement to be false and instead raise only an impermissible assertion of “fraud by
hindsight.” Ganem v. InVivo Therapeutics Holdings Corp., 845 F.3d 447, 457 (1st Cir. 2017).
Particularly where Plaintiffs assert that Viehbacher’s September 11, 2023 statements represent
Biogen’s first affirmative adoption of Eisai’s 10,000 patient goal, see Am. Compl. ¶ 217 [Doc.
No. 43], Defendants’ early optimism as to the attainability of this goal is not rendered misleading
by Defendants’ failure to reach this goal months later. See ACA Fin. Guar. Corp. v. Advest, Inc.,
512 F.3d 46, 62 (1st Cir. 2008) (“[A] complaint may not simply contrast a defendant’s past
optimism with less favorable actual results in support of a claim of securities fraud.” (quotation
omitted)). Beyond alleging that Biogen did not achieve the 10,000 patient goal, Plaintiffs have
alleged facts sufficient only to infer that, because the Leqembi rollout “in retrospect . . . lagged
significantly behind the proposed timeline, the timeline must have always been impossible to
achieve.” Ganem, 845 F.3d at 457. Such an inference does not meet the requisite pleading
standard under the PSLRA.
b. 	Forward-Looking Statements
The court agrees with Defendants that Viehbacher’s second, third, and fourth statements
are “forward-looking statements” for the purposes of the safe harbor.
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To be shielded under the PSLRA safe harbor, a statement must both be forward looking
and either accompanied by meaningful cautionary statements or not plausibly alleged to have
been made with actual knowledge that the statement was false or misleading. See 15 U.S.C.
§ 78u–5(c)(1). If “actual knowledge” that the statement was false or misleading is established by
inference, such inferences must be “strong,” rather than merely plausible. See In re Pharms., Inc.
Sec. Litig., No. 07-12581-GAO, 2007 WL 951695, at *9 (D. Mass. Mar. 28, 2007) (“Where the
statements challenged by the plaintiffs are forward-looking in nature, the PSLRA ratchets the bar
even higher: the facts pled by the plaintiffs must be sufficient to raise a strong inference that the
issuer of the statement had actual knowledge of the statement’s falsity.”). The three forward-
looking statements at issue here satisfy one or both conditions.
In these three statements, Viehbacher referred to the 10,000 patient goal in prospective
language as a “target” or “aim” for results expected several months in the future. See Am.
Compl. ¶¶ 304, 306, 309 [Doc. No. 43]; Hackel, 474 F. Supp. 3d at 478; Harrington v.
Tetraphase Pharms. Inc., 2017 WL 1946305, at *10 (D. Mass. May 9, 2017) (company’s
assertion that it “continue[d] to target submission of a new drug application . . . by year end” was
“squarely” within PSLRA’s definition of forward-looking statements). Such statements are of the
type the PSLRA contemplates as protected “statement[s] of the plans and objectives of
management for future operations.” See 15 U.S.C. § 78u–5(i)(1).
Viehbacher’s assertion on November 8, 2023––that Biogen “ha[d] an aim of getting to
10,000 patients” by the end of March 2024––was made during a quarterly earnings call. See Am.
Compl. ¶ 306 [Doc. No. 43]; Decl. of Jessica Lewis, Ex. 19, at 1, 3 [Doc. No. 49-19]. When read
in context, the statement was subject to a formal cautionary statement from Biogen’s head of
investor relations at the beginning of the call:
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I’d like to point out that we will be making forward-looking statements which are
based on our expectations. These statements are subject to certain risks and
uncertainties, and our actual results may differ materially. I encourage you to
consult the risk factors discussed in our SEC filings for additional detail.
Id. at 1 [Doc. No. 49-19]. The risk factors “discussed in [Biogen’s] SEC filings[,]” included,
inter alia, “risks associated with new product launches[,]” “the effectiveness of Eisai’s and
Biogen’s commercial strategy for marketing Leqembi[,]” and “requirements such as participation
in a registry and the use of imaging or other diagnostics[,]” all of which could “adversely
affect[]” the company’s ability to “successfully commercialize Leqembi.” Lewis Decl., Ex. 4, at
ECF 4 [Doc. No. 49-4]. Where Defendants’ cautionary statements were “sufficiently related in
subject matter and strong in tone to counter” the 10,000 patient goal, Hackel, 474 F. Supp. 3d at
478 (quoting In re Bos. Tech. Sec. Litig., 8 F. Supp. 2d 43, 53 (D. Mass. 1998)), Viehbacher’s
November 8, 2023 statement is covered under the PSLRA safe harbor. See id. (safe harbor
applicable to oral statements where speaker referred back to warnings included in SEC filings);
Isham v. Perini Corp., 665 F. Supp. 2d 28, 39 (D. Mass. 2009) (although “vague or boilerplate
disclaimers are insufficient[,]” cautionary statements can be meaningful if they are “substantive
and tailored to the specific future projections, estimates or opinions” challenged by the plaintiff
(quotations omitted)).
Viehbacher made the September 11, 2023 and January 8, 2024 statements, in which he
described the 10,000 patient goal as “more of a relevant benchmark” for Leqembi’s rollout and
as a “target . . . we’re working our way through[,]” respectively, at investment conferences and
did not accompany them with cautionary statements. See Am. Compl. ¶¶ 304, 309 [Doc. No. 43].
But Plaintiffs have not alleged facts sufficient to raise a strong inference that Viehbacher,
Biogen, or any other Defendant had actual knowledge that the 10,000 patient goal could not or
would not be reached on the timeline presented. For example, that Viehbacher spoke frequently
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with his counterpart at Eisai or that members of Biogen and Eisai’s joint steering committee
“constantly” discussed the 10,000 patient goal does not, without more, indicate actual knowledge
that the goal was unattainable.11 See In re Ariad Pharms., Inc. Sec. Litig., 842 F.3d 744, 751 (1st
Cir. 2016) (finding “glaring omission” in plaintiffs’ characterization of statements as materially
misleading where plaintiffs “do not . . . allege any specific facts about when the defendants
learned of these adverse events”).
Assertions from several confidential witnesses (“CWs”) also do not fill the inferential
gap. See Am. Compl. ¶¶ 214–15, 218–20, 222–23 [Doc. No. 43] (referencing the observations
and opinions of CWs 8, 9, 10, and 11). Although CWs need not “recall all possible details from
their former positions[,]” Collier v. ModusLink Global Solutions, Inc., 9 F. Supp. 3d 61, 73 (D.
Mass. 2014), the allegations provided by CWs “cannot merely be ‘conclusory allegations of
fraud, but specific descriptions of the precise means through which it occurred, provided by
persons said to have personal knowledge for them.’” Id. at 71 (quoting In re Cabletron Sys., Inc.,
311 F.3d 11, 30 (1st Cir. 2002)); see Premca Extra Income Fund LP v. iRobot Corp., 763 F.
Supp. 3d 121, 149 (D. Mass. 2025), appeal filed, No. 25-1192 (1st Cir. Feb. 2, 2025).
11 The court also notes that Viehbacher made the challenged January 8, 2024 statement during
the same investment conference presentation in which Plaintiffs assert that Viehbacher made a
“corrective” disclosure as to both the 10,000 patient goal and Leqembi’s roll-out more generally.
See Am. Compl. ¶¶ 309, 322 [Doc. No. 43]; Lewis Decl., Ex. 20, at 6 [Doc. No. 49-20]
(“There’s still––we’ve probably got about a target of 10,000 and we’re working our way through
that.”); id. at 7 (“Well remember, the 10,000 was really designed to give people some sort of
milestone . . . because there are no real analogues for this launch. I haven’t found a decent analog
anywhere. So what I think we were trying to say is, this isn’t going to be 100,000 patients, but
it’s not going to be a 1,000 either. . . . So that is a trajectory. And I think, where we are right
now, there’s nothing that we're going to do that's going to change us on the trajectory. We’ll get
there. We don’t get there, I think everything we're seeing, there’s no reason to say that we can't
get there. But again, the data were kind of choppy in December, so for me, I’m really looking for
the January data. But where we are right now is I know the 10,000 isn’t really what we’re
interested anymore is how do we now get to the 100,000?”).
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Confidential Witness 8 (“CW8”) and Confidential Witness 10 (“CW10”) never worked
for Biogen, see Am. Compl. ¶¶ 19, 21 [Doc. No. 43], and Plaintiffs do not allege with any
specificity that Defendants were aware of these witnesses’ observations or communications as to
Leqembi’s likely patient count. CW8, for example, worked as Eisai’s medical director from June
2022 to July 2023. Id. ¶ 19. Although CW8 asserts “repeatedly” reporting negative feedback
from physicians to Eisai’s Executive Director of Medical Affairs and being told by an Eisai
director that Eisai “expected to have no more than 5,000 patients” on Leqembi by the March
2024 deadline, see id. ¶¶ 215–16, Plaintiffs allege no facts suggesting this information was
communicated to, or known by, Biogen or its officers.
Similarly, Plaintiffs rely on an account from CW10, a director in Eisai’s Neuroscience
Business Group from June 2020 to July 2023, of the process for determining an accurate patient
uptake estimate and descriptions of “conversations in Eisai’s clinical discussion as to whether the
weak evidence of [Leqembi’s] benefit effect would be a sufficient incentive for patients to
overcome the barriers to receiving treatment.” Id. ¶ 219. But Plaintiffs again fail to allege a link
between this information from CW10, an Eisai employee, and knowledge possessed by Biogen
or its officers. Accordingly, the allegations attributed to CW8 and CW10 do not offer a sufficient
basis from which to infer that Defendants had actual knowledge that the 10,000 patient goal was
unlikely to be achieved. See Coyne v. Metabolix, Inc., 943 F. Supp. 2d 259, 267, 271 (D. Mass.
2013) (confidential witness statements not enough to satisfy actual knowledge, in part because
they were “not probative of any consciousness that the projected figures were impossible, or
even that they might have been overly optimistic”); see also Abiomed, 778 F.3d at 245 (where
confidential witnesses “did not even work at [defendant company]” during the class period, they
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“would not have had firsthand knowledge of the state of mind of [defendant’s] management
during that period”).
Confidential Witness 9 (“CW9”) and Confidential Witness 11 (“CW11”) did work at
Biogen during the putative Class Period, with CW9 holding various positions “supporting drug
development units” between November 2014 and October 2023 and CW11 holding various
positions involving financial planning and analysis between August 2014 and December 2023.
Am. Compl. ¶¶ 20, 22 [Doc. No. 43]. The mere fact of their employment, however, cannot
compensate for statements that are “conclusory and too vague” for the purposes of sufficient
allegations of actual knowledge. Coyne, 943 F. Supp. 2d at 267.
CW9, for example, alleges that Biogen based its “claims about progress” toward the
10,000 patient goal on registry data that “only reflects that patients have been screened and
identified as a good candidate[,]” rather than patients who are taking, or will take, the drug. Am.
Compl. ¶ 218 [Doc. No. 43]. At the same time, CW9 acknowledges that “patients taking
Leqembi were recorded in patient registries, which can be filtered to show how many patients are
on a certain drug.” Id. (emphasis added). Plaintiffs also ask this court to substitute CW11’s
experience with, and knowledge of, Biogen’s failed Aduhelm roll-out, along with CW11’s
opinion as to Biogen’s attitude toward “system constraints[,]” for Biogen and its officers’
knowledge regarding the Leqembi rollout. See, e.g., id. ¶ 220 (“CW11, who had been
responsible for patient forecasting during the Aduhelm roll-out, described Biogen’s lack of
interest in accurately forecasting patients.”); id. (“CW11[] summed up the attitude as, ‘They look
at issues like system constraints as a “tomorrow problem,” and they never worry about anything
other than what they think is a “today problem.”’”).
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Even resolving all inferences in Plaintiffs’ favor, as the court must do at this stage, no
“strong inference” as to Biogen’s actual knowledge can be drawn from the type of incongruous
or temporally unconnected information offered by CW9 and CW11. See Coyne, 943 F. Supp. 2d
at 267; In re Pharms., Inc. Sec. Litig., 2007 WL 951695, at *9 (“strong inference” as to actual
knowledge of statement’s falsity necessary when challenging forward-looking statements); In re
Stone & Webster, Inc. Sec. Litig., 253 F. Supp. 2d 102, 121 (D. Mass. 2003) (“[C]onflicting
allegations . . . undermine [plaintiffs’] own assertion that the disclosures . . . were false or
misleading.”).
2. 	Status of Leqembi Commercial Rollout
Plaintiffs identify six Biogen statements that allegedly misled investors as to the status of
the Leqembi commercial rollout more broadly. See Am. Compl. ¶¶ 300–01, 308, 311, 314–15
[Doc. No. 43]. Plaintiffs assert that these statements were false or misleading when made, or
omitted material facts necessary for such statements to not be misleading, because they failed to
disclose that (1) Biogen had no infrastructure in place to effectively sell Leqembi; (2)
infrastructure such as infusion centers would need to flexibly adapt to demand to not impede the
rollout of Leqembi; (3) Biogen had no way to determine where progress was made on the
“aggressive” 10,000 patient goal; (4) the 10,000 patient goal was adopted with no basis; (5)
internal projections were significantly lower than the 10,000 patient goal; and (6) “thus, Biogen
had no realistic ability to meet the 10,000 patient goal by March 2024, and indeed through the
rest of the year.” Id. ¶¶ 302, 305, 307, 309. Plaintiffs also allege that Defendants misled investors
into believing that Biogen’s Leqembi rollout could benefit from infrastructure implemented
during the failed Aduhelm rollout. See id. ¶ 312.
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The following statements are representative of those challenged by Plaintiffs, with the
specifically challenged statements and phrases indicated in bold text. During Biogen’s earnings
call for the second quarter of fiscal year 2023, Defendant Viehbacher stated:
I will say that the whole field organization is geared up for this. This is a much
more complex field organization than what you would have with a typical launch
with the care navigators, with MSLs, with field reps, with regional thought leader
professionals. So there are going to be a lot of people actually holding hands
with patients, with physician practices, trying to help make sure that this is as
seamless as possible.
Id. ¶ 300. Similarly, during the aforementioned September 11, 2023 investment
conference, Viehbacher stated:
There certainly seems to be demand there. I don’t––I think we’re confident in the
demand. I think we’re confident in the fact that physicians actually want to treat
these patients. The CMS has moved quickly actually. And that in some ways, it
shouldn’t have been but kind of caught everybody off guard because now we can
go. There’s no limitation. I mean the registry seems to be pretty easy to operate.
So this is now a question of filling the pipeline and pulling the patients through.
And ultimately, we will see that. And ultimately, all of these physician practices
will get good at this and understand this. But it is a heavy lift at the start. And I
think we’ll start to see that as we get through towards the end of the year. I think
nothing that we’re seeing says that the Eisai guidance can’t be met, which is
10,000 patients by the end of their fiscal year, which is the end of March.
Id. ¶ 303. As another example, during Biogen’s earnings call for the fourth quarter of fiscal year
2023, Viehbacher stated, “Now as we look at what does drive growth, clearly, we have
Leqembi. And I’ll remind everybody that, again, we are not just pioneering in science but
pioneering in commercial.” Id. ¶ 314.12
12 Insofar as these statements refer to the 10,000 patient goal, the court has assessed Plaintiffs’
claims in the preceding discussion and incorporates by reference the court’s analysis as to the
inadequacy of the relevant CWs’ allegations. See Section IV(A)(1), supra.
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Defendants counter that any such statements are either nonactionable statements of
corporate optimism or are not adequately alleged to be false. See Reply 8–12 [Doc. No. 57];
Mem. ISO Mot. to Dismiss 24–25 [Doc. No. 50]. The court considers these arguments in turn.
a. 	Statements of Corporate Optimism
Although a statement or omission’s materiality is a “question of fact that should normally
be left to a jury rather than resolved by the court on a motion to dismiss. . . . not every unfulfilled
expression of corporate optimism, even if characterized as misstatement, can give rise to a
genuine issue of materiality under the securities laws.” In re Biogen Inc. Sec. Litig., 193 F. Supp.
3d at 41 (quotations omitted). Assertions of optimism or puffery “require a court to consider (1)
whether the statement is so vague, so general, or so loosely optimistic that a reasonable investor
would find it unimportant to the total mix of information” and “(2) whether the statement was
also considered unimportant to the total mix of information by the market as a whole.” In re
Wayfair, Inc. Sec. Litig., 471 F. Supp. 3d 332, 339 (D. Mass. 2020) (quotation omitted).
Here, many of the challenged statements, in whole or in part, are within the ambit of
corporate optimism or puffery. Through Viehbacher, Biogen expressed generic confidence in,
and bullishness about, the Leqembi rollout, including that the company was seeing, inter alia, “a
number of green shoots” and “signs of progress[,]” Am. Compl. ¶ 306 [Doc. No. 43]; success in
“pioneering this commercial approach[,]” id.; internal metrics “progress[ing] extremely
nicely[,]” id.; “an awful lot of tremendous progress[,]” id. ¶ 308; and growth driven by sales of
Leqembi and Biogen’s success “not just pioneering in science but pioneering in commercial[,]”
id. ¶ 314. Neither a reasonable investor nor the market as a whole would view these sanguine,
subjective statements as material. See, e.g., In re Wayfair, Inc. Sec. Litig., 471 F. Supp. 3d at 338
(finding statements about defendant’s “delight” with its progress, “incredibly bullish” view of its
business, and expectation that market share would grow were “examples of expressions of loose
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optimism and here immaterial”); In re Biogen Inc. Sec. Litig., 193 F. Supp. 3d at 42 (finding
statements about “forward momentum[,]” “plenty of tailwind[,]” and the defendant’s “belie[f]
that [a drug] will continue to be a major business driver” to be non-actionable corporate
optimism); In re Parametric Tech. Corp., 300 F. Supp. 2d 206, 218 (D. Mass. 2001) (finding
defendant’s assertion of “‘confidence’ in ‘the fundamental strength of its business’ and its
‘strong competitive position’” was “expectable corporate puffery” (quotations omitted)).
Accordingly, such statements are properly viewed as immaterial and inactionable for the
purposes of the PSLRA. See In re Wayfair, Inc. Sec. Litig., 471 F. Supp. 3d at 338; In re Biogen
Inc. Sec. Litig., 193 F. Supp. 3d at 4.
b. 	Insufficient Factual Allegations
The challenged statements that do not constitute corporate optimism or puffery refer, in
broad terms, to Biogen’s affirmations that the Leqembi rollout was taking place according to
Biogen’s plan, estimates of the number of patients taking or eligible to take Leqembi, and
deployment or redeployment of resources for the Leqembi rollout.13 At core, Plaintiffs assert that
Defendants’ statements were false, misleading, or omitted necessary information where such
statements did not disclose that Defendants lacked sufficient infrastructure and sales visibility
13 See, e.g., Am. Compl. ¶ 300 [Doc. No. 43] (“I will say the whole field organization is geared
up for this. . . . So there are going to be a lot of people actually holding hands with patients, with
physician practices, trying to help make sure that this is as seamless as possible.”); id. ¶ 301
(“[S]o far, everything is—as far as we’re concerned, the launch is going to plan.”); id. ¶ 308 (“So
now there’s kind of a rush. . . . So numbers of PET scans are going up. . . We’re seeing a
significant increase in the numbers of new patient starts on the registry.”); id. (“So I think we’re
feeling pretty good. I’m looking forward to seeing how the January sales play out. A lot of
positive data in December. . . .”); id. ¶ 311 (“A large portion of the resources released from the
termination of the Aduhelm program will be redeployed in Biogen’s AD franchise.”); id. ¶ 315
(“[W]e have an indication that there are about 3,800 patients as of last week on the registry” and
“we do believe we’re making a very solid progress. And we believe that we have validated the
go-to-market model.”).
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into the Leqembi rollout and had “no realistic ability” to meet the 10,000 patient goal. See Am.
Compl. ¶¶ 302, 305, 307, 310, 312, 316 [Doc. No. 43]. Plaintiffs do not adequately allege that
such statements were false or misleading.
Again, to survive a motion to dismiss, Plaintiffs must show “that defendants made a
materially false or misleading statement or omitted to state a material fact necessary to make a
statement not misleading.” Ganem, 845 F.3d at 454 (quotation omitted). “A fact or omission is
material if a reasonable investor would have viewed it as having significantly altered the total
mix of information made available.” Zhou, 120 F.4th at 292 (quotation omitted).
Plaintiffs have not sufficiently alleged that Defendants’ statements regarding the Leqembi
rollout plan or patient counts were not objectively true when made. Plaintiffs do not, for
example, allege that, as of the July 25, 2023 earnings call, the Leqembi “launch” was not “going
to plan” or that Biogen’s field organization was not “geared up” for the rollout. Am. Compl.
¶¶ 300–01 [Doc. No. 43]. Plaintiffs’ allegations as to Viehbacher’s January 8, 2024 statement
that Biogen was “not seeing any capacity constraints on PET scans, nor on MRIs, nor on infusion
centers for the moment[,]” id. ¶ 309 (emphasis added), are likewise insufficient where the
alleged falsity mainly arises via comparison to statements made nine to eleven months prior and
an earnings call statement made one month later. See id. ¶ 214 (citing to statements from
February 15, March 6, and April 25, 2023, in which Viehbacher discussed various capacity
constraints); id. ¶ 325 (citing to the February 13, 2024 earnings call, during which Viehbacher
asserted that “there [was not] an MRI capacity constraint per se” but acknowledged some
difficulty in the “coordination” of “specific date[s]” and “the bottleneck of getting into the
neurologist”).
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Similarly, Plaintiffs do not allege that, as of Biogen’s February 13, 2024 earnings call,
there were not, in fact, “3,300 patients on the registry” according to an analyst report or “an
indication that there [were] about 3,800 patients as of last week on the registry.” Id. ¶ 315. That
Plaintiffs fail “to allege particularized facts supporting falsity . . . is . . . a facial pleading
deficiency under the PSLRA and Rule 9(b).” Premca Extra Income Fund LP, 763 F. Supp. 3d at
148.
Insofar as Plaintiffs allege that various statements were rendered misleading due to
omissions, “[S]ection 10(b) and Rule 10b-5 ‘do not create an affirmative duty to disclose any and
all material information.” Id. at 147 (quoting Matrixx Initiatives, Inc. v. Siracusano, 563 U.S. 27,
44 (2011)). Even where an omission is material, it is actionable “only if it ‘renders affirmative
statements made misleading.’” Id. (quoting Macquarie Infrastructure Corp. v. Moab Partners,
L.P., 601 U.S. 257, 265 (2024)). Plaintiffs must allege sufficient facts demonstrating that
Biogen’s statements were “so incomplete as to mislead.” In re Karyopharm Therapeutics, Inc.
Sec. Litig., 552 F. Supp. 3d 77, 86 (D. Mass. 2021) (quoting Hill v. Gozani, 638 F.3d 40, 57 (1st
Cir. 2011)), aff’d sub nom. Thant v. Karyopharm Therapeutics, Inc., 43 F.4th 214 (1st Cir.
2022).
Here, the challenged statements, without more, convey only Biogen’s assessment of
present conditions that did not require additional detail, such as Biogen’s reliance on a large sales
effort, see Am. Compl. ¶ 301 [Doc. No. 43]; or are consistent with other factual allegations made
by Plaintiffs. See, e.g., id. ¶ 303 (alleging that, in September 2023, Defendants described the
Leqembi rollout as “a heavy lift at the start”); id. ¶¶ 306, 315 (as reported by Biogen, the number
of Leqembi patients grew from 800 in November 2023 to 2,000 in February 2024); id. ¶ 315
(reporting “increased activity and volume” in diagnostic steps required for a Leqembi
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prescription and cautioning that the number of patients on the registry “is not perfect
information”).
As to Biogen’s statements regarding resource deployment, see id. ¶¶ 301, 311, Plaintiffs
again fail to allege that Biogen was not deploying resources as reported. See Premca Extra
Income Fund LP, 763 F. Supp. 3d at 148. For example, Plaintiffs suggest that Biogen’s May 3,
2022 statement about its planned reduction of Aduhelm infrastructure, in which Defendant
Vounatsos told investors that Biogen was “substantially eliminating commercial infrastructure”
for the launch of Aduhelm as part of a $1 billion cost-cutting effort, Am. Compl. ¶ 114 [Doc. No.
43], renders misleading or lacking in necessary material information Defendants’ statement in a
January 31, 2024 press release declaring that a “a large portion if resources released resulting
from termination of the Aduhelm program will be redeployed in Biogen’s AD franchise[.]” Id.
¶ 311. But Plaintiffs’ suggestion draws an erroneous equivalency between whether the remaining
Aduhelm infrastructure would be sufficient for the launch of other AD drugs and whether the
remaining Aduhelm infrastructure would be deployed for such launches. Biogen made no
representations as to the former and was therefore not obligated to make additional adequacy
disclosures, as Plaintiffs argue. See, e.g., Backman v. Polaroid Corp., 910 F.2d 10, 16 (1st Cir.
1990) (defendant’s statement that it was selling a product “below cost” was “not misleading by
reason of not saying how much below”).
3. 	Statements About Leqembi’s Safety Profile
Plaintiffs allege both that Eisai failed to properly disclose a third participant death and
that the severity of Leqembi’s risk profile for ARIA was not properly communicated. See Am.
Compl. ¶¶ 184–210 [Doc. No. 43].
Plaintiffs identify nine statements that allegedly misled investors as to Leqembi’s safety
profile, particularly with respect to the incidence and risk of ARIA in patients taking Leqembi.
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See id. ¶¶ 283–89. Plaintiffs primarily contend that (1) Defendants failed to disclose a patient
death that occurred during a Leqembi clinical study; and (2) to the extent Defendants did
disclose patient deaths, Eisai’s assessment that such deaths were not attributable to Leqembi, as
adopted by Biogen, was false or misleading. See id. Defendants argue that the challenged
statements are either inactionable statements of scientific opinion or did not give rise to
additional disclosure obligations. See Mem. ISO Mot. to Dismiss 15–20 [Doc. No. 50].
As to Defendants’ purported statements of scientific opinion, “courts have been clear
that scientific opinions are just that: opinions.” Harrington, 2017 WL 1946305, at *5; see In re
Karyopharm Therapeutics Inc., Sec. Litig., 552 F. Supp. 3d at 89. “The most significant
difference between statements of fact and expressions of opinion is that ‘a statement of fact (“the
coffee is hot”) expresses certainty about a thing, whereas a statement of opinion (“I think the
coffee is hot”) does not.’” Constr. Indus. & Laborers Joint Pension Tr. v. Carbonite, Inc., 22
F.4th 1, 7 (1st Cir. 2021) (quoting Omnicare, Inc. v. Laborers Dist. Council Constr. Indus.
Pension Fund, 575 U.S. 175, 183 (2015)). “Words like ‘I think’ or ‘I believe’ can play a role in
demonstrating a lack of certainty, . . . but their use does not preclude the possibility that the
statement as a whole may still mislead as to some fact[.]” Id. (quoting Omnicare, 575 U.S. at
193).
Analytical conclusions may constitute opinions where “two knowledgeable analysts, each
acting in the utmost good faith,” could arrive at divergent interpretations of the same data. Credit
Suisse First Bos. Corp., 431 F.3d 36, 47 (1st Cir. 2005), overruled on other grounds by Tellabs,
Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308 (2007); In re Karyopharm Therapeutics Inc.,
Sec. Litig., 552 F. Supp. 3d at 89 (although defendants’ interpretation of data “may have been
erroneous[,”] results from the FDA’s and the defendants’ differing methodology and analytical
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assumptions as to the same data was a non-actionable scientific disagreement). Several circuits
explicitly extend this tenet to differing interpretations of clinical trial data. See, e.g., City of
Edinburgh Council v. Pfizer, Inc., 754 F.3d 159, 170–71 (3d Cir. 2014) (“Interpretations of
clinical trial data are considered opinions.”); Kleinman v. Elan Corp., plc, 706 F.3d 145, 154 (2d
Cir. 2013) (“[W]here a defendant’s competing analysis or interpretation of data is itself
reasonable, there is no false statement.”); see also In re Sanofi Sec. Litig., 87 F. Supp. 3d 510,
543 (S.D.N.Y. 2015) (noting that courts have “repeatedly held publicly stated interpretations of
the results of various clinical studies to be opinions because reasonable persons may disagree
over how to analyze data and interpret results, and neither lends itself to objective conclusions”
(quotations omitted)), aff’d sub nom. Tongue v. Sanofi, 816 F.3d 199, 214 (2d Cir. 2016).
That a statement is properly classified as an opinion, however, does not necessarily
exclude “the possibility that the statement as a whole may still mislead as to some fact[.]”
Constr. Indus. & Laborers, 22 F.4th at 7. A statement of opinion
may convey three facts: that the speaker has such a belief; that the belief fairly
aligns with the facts known to the speaker; and, if stated in the context of the
securities market, that the speaker has made the type of inquiry that a reasonable
investor would expect given the circumstances.
Id. (citing Omnicare, 575 U.S. at 188–89). Accordingly, “if the real facts are otherwise, but not
provided, the opinion statement will mislead its audience.” Shash v. Biogen, 84 F.4th 1, 12 (1st
Cir. 2023) (citing Omnicare, 575 U.S. at 188).
As to whether Defendants were required, but failed, to disclose additional facts regarding
the Phase 3 clinical trial data, “[d]isclosure of specific information is only required when
‘necessary to make . . . statements made, in the light of the circumstances under which they were
made, not misleading’” Thant, 43 F.4th at 222 (quoting Matrixx, 563 U.S. at 44); see 17 C.F.R.
§ 240.10b–5(b). Thus, “if a company proactively discloses some facts about its product, it is not
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thereby obliged to disclose all information that would be interesting to potential investors.”
Thant, 43 F.4th at 222–23. (quotation omitted). Instead, a company “must only disclose those
facts ‘that are needed so that what has been revealed would not be so incomplete as to mislead.’”
Id. at 223 (cleaned up) (quoting Backman, 910 F.2d at 16).
a. 	Completeness of Patient Death Disclosures
i. 	Number of Patient Deaths in the Phase 3 OLE Study
Plaintiffs assert that the reported “safety results” of the Leqembi Phase 3 clinical trial in
Biogen and Eisai’s November 29, 2022 joint press release was false or misleading because it
disclosed the death of two, rather than three, trial participants “with concurrent cerebral
macrohemorrhage[.]” Am. Compl. ¶¶ 283–84 [Doc. No. 43]. Plaintiffs raise similar claims with
respect to statements made by Defendants on January 6, 2023, April 25, 2023, July 25, 2023, and
August 1, 2024. See id. ¶¶ 288–89, 293–98.
The “data cutoff” for the information presented on November 29, 2022, was October 22,
2022. See id. ¶ 204. By the cutoff date, Patient 1 had died several months prior, and an adverse
event report filed with the FDA by the relevant clinical trial investigator indicated that the death
was “related” to Leqembi. Id. ¶ 186. Patient 2 had died roughly two months prior, and, as with
Patient 1, the relevant clinical trial investigator indicated in an adverse event report that the
patient’s death was “related” to Leqembi. Id. ¶¶ 189–90. Both deaths were reflected in the press
release. See id. ¶ 283 (“In the core study and subsequent open-label extension study, rates of
death with concurrent cerebral macrohemorrhage were 0.1% in both the placebo group (1/897)
and the [Leqembi] group (2/1608).” (emphasis added)).
Plaintiffs assert that Defendants were obligated to disclose Patient 3’s death alongside the
deaths of Patients 1 and 2. See id. ¶ 284. In Plaintiffs’ view, the failure to do so contributed to
“the false impression that there were only two deaths in the [OLE study] with concurrent
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symptoms of ARIA-H when, in fact, there were three.” Id. But Plaintiffs’ assertion does not align
with Plaintiffs’ other allegations as to Patient 3’s death––namely, that (1) Patient 3’s death,
which occurred on September 19, 2022, was only “preliminarily classified . . . as ‘related’ to
Leqembi in light of the extensive ARIA symptoms pending receipt of MRI scans and the autopsy
report” as of the cutoff date, id. ¶¶ 192–93 (emphases added); and (2) there was no
“macrohemorrhage,” where the autopsy report determined that Patient 3 experienced “51
microhemorrhages[,]” rather than a macrohemorrhage, associated with Patient 3’s death. Id.
¶ 192.
Where Plaintiffs allege that Patient 3’s autopsy was not performed until March 2023 and
the results provided to Eisai “in late March to early April 2023[,]” they cannot also plausibly
allege that Defendants possessed full information subject to disclosure in November 2022. See In
re Stone & Webster, 253 F. Supp. 2d at 121 (plaintiffs’ allegations as to false or misleading
disclosures “undermine[d]” by “conflicting allegations”). Plaintiffs’ pleadings as to this
challenged statement also do not survive the fundamental disjunction between the incidences of
macrohemorrhage reported by Eisai and Biogen and the microhemorrhages later discovered in
Patient 3’s brain. See Am. Compl. ¶¶ 283, 192 [Doc. No. 43].
In Thant, the First Circuit held that investors did not plausibly allege that the defendant
pharmaceutical company omitted material “data regarding the prevalence and severity of
[disclosed adverse events]” from the company’s clinical study of a new drug intended for
treatment of multiple myeloma. 43 F.4th at 224; see id. at 224–26. Where the study participants
were seriously ill and “pursuing their ‘last chance’ for survival[,]’” and where the defendant
informed investors in its Form 10-K filings about “serious” adverse events observed during the
study and the possibility that such events would negatively impact the likelihood of FDA
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approval, the First Circuit concluded that investors could not plausibly believe the drug “was
benign, or that the FDA would find it so.” Id. at 224–25. Accordingly, “[a]lthough investors may
have been interested in the specific serious [adverse events] experienced by . . . trial
participants, . . . a company is not, by virtue of making some disclosures about its products,
obligated to disclose all potentially interesting information.” Id. at 226 (citing Backman, 910
F.2d at 16).
By contrast, in In re Ariad Pharmaceuticals, Inc. Securities Litigation, the defendant
pharmaceutical company publicly “express[ed] optimism about [a new drug’s] chances for
approval with a ‘favorable [FDA] label’” even after the FDA rejected the label and, despite
possessing data indicating that cardiovascular issues were the most prevalent serious adverse
events, reported that pancreatitis was the most prevalent. 842 F. 3d at 753. The First Circuit,
through the lens of a scienter analysis, concluded that the defendant’s overt omission as to the
FDA and mischaracterization as to observed adverse events “would have altered the total mix of
information available to investors.” Id. Such misstatements therefore served as sufficient
predicates for claims brought against the company under Section 10(b) and Rule 10b-5. Id.;
Thant, 43 F.4th at 225 (examining the relevant portion of In re Ariad Pharmaceuticals, Inc. Sec.
Litigation in the context of sufficiently pleaded materially misleading statements).
In line with Thant, the court finds that Defendants’ November 29, 2022 statement as to
the incidence of macrohemorrhage observed in the Leqembi Phase 3 trial did not give rise to a
contemporaneous obligation to disclose Patient 3’s death. See 43 F.4th at 226. As noted supra,
the type of hemorrhage experienced by Patients 1 and 2 is not necessarily fungible with the type
experienced by Patient 3. But, even setting this distinction aside, the November 29, 2022 press
release adequately communicated the risk of microhemorrhages associated with Leqembi use,
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the risk of ARIA more broadly, and the general relationship between Leqembi’s risk profile and
the likelihood of regulatory approval. See, e.g., Lewis Decl., Ex. 8, at ECF 2 [Doc. No. 49-8]
(listing “ARIA-H (combined cerebral microhemorrhages, cerebral macrohemorrhages, and
superficial siderosis)” as one of “[t]he most common adverse events (>10%)” where it was
observed in 17.3% of those on Leqembi versus 9.0% of those on a placebo); id. (listing “ARIA-E
(edema/effusion)” as one of “[t]he most common adverse events (>10%)” where it was observed
in 12.6% of those on Leqembi versus 1.7% of those on a placebo); id. at ECF 5 (warning that
“[r]esults in early-stage clinical studies may not be indicative of full results from later stage or
larger scale clinical studies and do not ensure regulatory approval”). Investors were therefore
adequately apprised of the risks associated with Leqembi, both as a product and as a driver of
Biogen’s business.
Thus, although investors “may have been interested” in the occurrence of, or preliminary
determinations concerning, Patient 3’s death or “wished to know more” about the association
between microhemorrhages and Leqembi, see Thant, 43 F.4th at 226, Plaintiffs have not
plausibly alleged that the information Defendants did disclose was materially misleading. Insofar
as Plaintiffs raise the nondisclosure of Patient 3’s death with respect to Defendants’ subsequent
statements on January 6, 2023, April 25, 2023, July 25, 2023, and August 1, 2024, the “total mix
of information” presented in those statements similarly would not have been altered by such a
disclosure. See Zhou, 120 F.4th at 292; Abiomed, 778 F.3d at 240 (citing City of Dearborn
Heights Act 345 Police & Fire Ret. Sys. v. Waters Corp., 632 F.3d 751, 756 (1st Cir. 2011)).
There is, however, one statement in this category, referring to “other studies,” that may
meet the PSLRA’s misleading statement standard. Plaintiff points to a joint press release issued
by Biogen and Eisai on January 6, 2023, stating:
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Incidence of ARIA
In Study 1 (Study 201), symptomatic ARIA occurred in 3% (5/161) of LEQEMBI-
treated patients. Clinical symptoms associated with ARIA resolved in 80% of
patients during the period of observation.
. . . .
Intracerebral hemorrhage >1 cm in diameter was reported after one treatment in
LEQEMBI: 1 patient; placebo: zero patients. Events of intracerebral hemorrhage,
including fatal events, in patients taking LEQEMBI have also been reported in
other studies.
Apolipoprotein E ε4 (ApoE ε4) Carrier Status and Risk of ARIA
. . . .
The incidence of ARIA was higher in ApoE ε4 homozygotes than in heterozygotes
and noncarriers among patients treated with LEQEMBI. Of the 5 LEQEMBI-
treated patients who had symptomatic ARIA, 4 were ApoE ε4 homozygotes, 2 of
whom experienced severe symptoms. An increased incidence of symptomatic and
overall 	ARIA 	in 	ApoE 	ε4 	homozygotes 	compared 	to 	heterozygotes 	and
noncarriers in LEQEMBI-treated patients has been reported in other studies.
Am. Compl. ¶ 285 [Doc. No. 43] (the “other studies statement”). Plaintiffs allege that “the same
or substantially similar statements . . . were also made by Biogen in press releases issued on
January 10, 2023, March 5, 2023, and June 9, 2023.” Id. ¶ 286.
Plaintiffs allege that Biogen’s references to “other studies” were misleading, as they
“gave the false impression that [there] were no such events in the recently completed Phase 3
study.” Id. ¶ 287. Defendants counter that this language “mirrored the FDA-approved label for
Leqembi” and must be read in the context of the “FDA-approved warning” included in each
press release, which “described the incidence of ARIA in study participants, including the
number of ApoE4 carriers relative to the incidence of ARIA.” Mem. ISO Mot. to Dismiss 18–19
[Doc. No. 50]. Defendants also contend that the results from “other studies” refer to the results
from the Phase 3 OLE, which Defendants characterize as “a separate study from the placebo-
controlled, 18-month Phase 3 study.” Id. at 19.
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In Shash v. Biogen, Inc., 84 F.4th 1 (1st Cir. 2023), the First Circuit found misleading a
statement in which a Biogen executive represented that, contrary to subgroup data of which
Biogen was aware, “all” of its data from a clinical study were consistent with the need for a
higher dosage of a drug under study. See id. at 12–13. Defendants’ use of “other” in the “other
studies” statement rings of a similar obliqueness, as investors could plausibly be misled into
believing that the serious risks identified in the statement were observed in studies unaffiliated
with the Phase 3 trial.
But this does not end the inquiry, as a misleading statement “must also be material” to
proceed beyond a motion to dismiss. Id. at 13; see Thant, 43 F.4th at 222 (asserting that “neither
factor alone is sufficient”). Here, the materiality of the “other studies” statement and similar
assertions in subsequent press releases is unconvincing. As a threshold matter, the results of the
Phase 3 OLE study, including the deaths of Patients 1 and 2, were published in November 2022,
discussed supra, and thus already known to investors when Biogen and Eisai published the
January 6, 2023 press release. See In re The First Marblehead Corp. Sec. Litig., 639 F. Supp. 2d
145, 155 (D. Mass. 2009) (“A plaintiff fails to plead an actionable § 10(b) claim predicated on
the concealment of information if that information was, in fact, disclosed.”). Plaintiffs have also
not sufficiently pleaded that the “total mix of information” would have changed had the Phase 3
OLE study been properly referenced, as both the fundamental ARIA risk associated with
Leqembi, and the greater ARIA risk for individuals with two copies of the ApoE4 allele, were
adequately communicated, even if the precise source of information about those risks was
unclear. See Zhou, 120 F.4th at 292; Abiomed, 778 F.3d at 240. Cause of Patient Deaths in the
Phase 3 OLE Study
In addition to challenging the reported number of patient deaths in the Phase 3 OLE
study, Plaintiffs also challenge Biogen and Eisai’s conclusion, either stated explicitly or implied,
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that these patient deaths could not be attributed to Leqembi. See Am. Compl. ¶¶ 283–84, 288–89
[Doc. No. 43].
In the November 29, 2022 press release, with respect to the deaths of Patients 1 and 2,
Eisai and Biogen stated, in relevant part:
In the core study and subsequent open-label extension study, rates of deaths
with concurrent cerebral macrohemorrhage were 0.1% in both the placebo
group (1/897) and the [Leqembi] group (2/1608). The two cases on [Leqembi]
occurred 	in 	the 	open-label 	extension 	study. 	Both 	cases 	had 	significant
comorbidities and risk factors including anticoagulation contributing to
macrohemorrhage or death. Therefore, it is Eisai’s assessment that the deaths
cannot be attributed to [Leqembi].
Id. ¶ 283. On January 6, 2023, the date on which the FDA granted Leqembi accelerated approval,
Biogen published a press release directing investors to “an additional news release from Eisai on
patient safety” and containing a hyperlink to that Eisai release. Id. ¶ 288.14 The Eisai press
release stated:
Important Considerations in the Study of Alzheimer’s Disease
Part of Eisai’s commitment to patient safety is studying the frequency, pattern,
causes 	and 	risk 	factors 	of 	diseases 	and 	health-related 	events 	in 	different
populations. According to the World Health Organization (WHO), dementia is the
seventh leading cause of death among all diseases and the Centers for Disease
Control and Prevention (CDC) reports that AD is the leading cause of dementia and
the fifth leading cause of death for those 65 years and older. According to the
Alzheimer’s Association, the average survival after diagnosis is typically three to
eleven years (median survival time: eight years). The patients who participate in
trials for AD treatments have a relatively high rate of mortality due to the
physical effects resulting from the natural progression of AD and the variety
of medical conditions that develop as people continue to age. For example,
comprehensive reviews of the scientific literature have found that patients with AD
have a significantly higher incidence of hemorrhagic strokes (strokes associated
with 	bleeding 	in 	the brain). 	When 	evaluating 	suspected 	serious 	adverse
reactions, including death, of any clinical trial participants or patients
14 In their Memorandum [Doc. No. 50], Defendants asserted that they could not be held liable for
this statement because it appeared in an Eisai-only press release. See id. at 19 n.20 (citing Janus
Cap. Grp., Inc. v. First Deriv. Traders, 564 U.S. 135, 146–48 (2011)). Defendants did not,
however, press this issue in their Reply [Doc. No. 57].
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prescribed medications outside clinical trials, one must consider factors like
age, clinical history, concomitant medications, temporal correlation, biologic
plausibility, and effects of dechallenge/rechallenge of the suspected drug.
. . . .
ARIA-H can occur spontaneously in patients with AD. ARIA-H associated with
monoclonal antibodies directed against aggregated forms of beta amyloid generally
occurs in association with an occurrence of ARIA-E. ARIA-H of any cause and
ARIA-E can occur together. ARIA is usually asymptomatic, although serious and
life-threatening events, including seizure and status epilepticus, rarely can occur.
When present, reported symptoms associated with ARIA may include headache,
confusion, 	visual 	changes, 	dizziness, 	nausea 	and 	gait 	difficulty, 	and 	focal
neurologic deficits may also occur. These symptoms usually resolve over time.
Intracerebral hemorrhage greater than 1 cm in diameter has been reported. Events
of 	intracerebral 	hemorrhage, 	including 	fatal 	events, 	in 	patients 	taking
LEQEMBI have also been reported.
Id.
Defendants assert that these statements (the “cause-of-death statements”) constituted
scientific opinions and, consequently, disagreements with those opinions––whether from
Plaintiffs or from external parties––cannot form the basis of a securities fraud claim “unless the
opinion was objectively and subjectively false.” Mem. ISO Mot. to Dismiss 16 [Doc. No. 50]
(citations omitted). In considering this argument, the court must determine if either the
November 29, 2022 statement or the January 6, 2023 statement “materially misleads” as to
Biogen’s belief that the patient deaths were not attributable to Leqembi; whether Biogen’s belief
fairly aligned with the facts known to it; or whether Biogen “made the type of inquiry that a
reasonable investor would expect given the circumstances.” Constr. Indus. & Laborers, 22 F.4th
at 7 (citing Omnicare, 575 U.S. at 188–89).
The most tenable avenue through which Biogen could have accumulated knowledge
indicating that the reported patient deaths were, in fact, attributable to Leqembi are the alleged
collaboration and information sharing agreements between Biogen and Eisai. See Am. Compl.
¶¶ 77, 79 [Doc. No. 43]. According to Plaintiffs, the first of these agreements, entered into in
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2014, set forth that Biogen and Eisai would “jointly develop and commercialize two product
candidates under development by Eisai for the treatment of AD[,]” including Leqembi. Id.
¶ 77. In 2017, Biogen and Eisai “amended and restated” the 2014 agreement (the “2017
agreement”). Id. ¶ 79. Under the 2017 agreement, Eisai “remained the primary lead for the
development of [Leqembi], including clinical trial management and regulatory filings.” Id.
(emphasis added). Plaintiffs allege that, although Eisai possessed “final decision-making
authority over all matters relating to the [d]evelopment and [c]ommercialization” of Leqembi
under the 2017 agreement, Biogen “did not lack visibility or input on those matters.” Id. ¶ 377.
In support of this assertion, Plaintiffs point to Biogen’s participation with Eisai in various
joint committees related to the development of Leqembi, the information sharing between
Biogen and Eisai facilitated by those committees, and Biogen and Eisai’s agreement that neither
party could issue a press release or public statement regarding their collaboration without the
consent of the other. See id. ¶¶ 377–80. Singhal, as Plaintiffs emphasize, was the chair of Biogen
and Eisai’s “[j]oint [s]teering [c]ommittee[.]” Id. ¶ 383. Plaintiffs also highlight various
statements made by Biogen executives regarding the Biogen-Eisai relationship, including
Vounatsos’ indications that Biogen and Eisai were “engaging very closely” and “working very
closely” in 2018 and 2022, respectively, id. ¶ 381; and his assertion in 2022 that he “talk[ed]
every second day with [his] opposite number” at Eisai, id. ¶ 382.
Although these allegations give rise to a plausible inference that Biogen and Eisai
frequently communicated and possessed a detailed awareness of each other’s work, they do not
go so far as to permit a plausible inference that Biogen knew of the specific information and data
on which Eisai based its conclusions as to the affected Phase 3 study patients’ causes of death.
And assuming, arguendo, that Biogen was privy to this information, Plaintiffs offer nothing from
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which to infer that Biogen was aware of other information contradicting or otherwise calling into
question Eisai’s opinion that the patient deaths at issue cannot be attributed to Leqembi. See,
e.g., Miss. Pub. Emps.’ Ret. Sys. v. Bos. Sci. Corp., 523 F.3d 75, 91 (1st Cir. 2008) (statement
that a known problem with a physical product was “fixed” actionable where defendant was
aware that another recall of the product would be announced one week later); Pizzuto v.
Homology Meds., Inc., No. 1:23-CV-10858-AK, 2024 WL 1436025, at *9 (D. Mass. Mar. 31,
2024) (no actionable claim where plaintiffs did not allege that “any statements [defendant] made
directly contradicted the undisclosed information”).
Plaintiffs also cite several articles, published in scientific journals and industry
publications between October 2022 and December 2022, that reported on the results of the Phase
3 trial and the deaths of Patients 1, 2, and 3. See Am. Compl. ¶¶ 201–03, 207 [Doc. No. 43]. At
least three articles included statements from external physicians and researchers, several of
whom opined that Leqembi caused or contributed to the deaths of Patients 2 and 3. See id. ¶ 201
(quoting October 29, 2022 Stat+ article, entitled “Death of patient in closely watched
Alzheimer’s trial raises concern about risk for some groups”15); id. ¶ 202 (quoting November 27,
2022 article in Science, in which a neurologist, upon review of Patient 2’s case report, stated that
“there’s zero doubt in my mind that this is a treatment-caused illness and death . . . if the patient
hadn’t been on [Leqembi], she would be alive today”16 (cleaned up)); id. ¶ 207 (quoting
15 As quoted in the article, an Eisai representative acknowledged Patient 1’s death but stated that
“there’s no reason to believe that [Leqembi] contributes to death overall in the study, or by any
specific cause.” Id.
16 The article stated further that “several physicians and researchers, including several not
involved in the [Phase 3 trial], reviewed the case report and agreed that Leqembi likely
contributed to [Patient 2’s] death,” and that Eisai did not comment on the death but did state that
“[a]ll the available safety information indicates that [Leqembi] therapy is not associated with an
increased risk of death overall or from any specific cause.” Id.
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December 21, 2022 ScienceInsider article, which cited to “multiple neuroscientists” who
“believe[d]” Patient 3’s death was likely caused by Leqembi upon “review[] [of] the records at
Science’s request”17).
When read in their full context, these articles speak to the existing scientific disagreement
as to the role played by Leqembi in these deaths. The October 29, 2022 Stat+ article, for
example, also acknowledged that Patient 1 had suffered “multiple falls, a heart attack, a
respiratory infection, and mini-stroke-like events” in prior months that could have also
precipitated his death. Suppl. Decl. of Jessica Lewis Ex. 27, at 1–2 [Doc. No. 56-1]; see id. at 4
(noting that the relevant trial investigator concluded that Patient 1’s death was “related” to
Leqembi but also reported that Patient 1 suffered an unrelated heart attack before his death, along
with “four mini-stroke-like events” later classified as “related” to Leqembi). Similarly, the
November 2022 Science article referred to Patient 1’s death as still “under investigation” at the
time of publication and, with respect to Patient 2, described varying opinions, but no crystallized
consensus, as to Patient 2’s death. Suppl. Lewis Decl. Ex. 28, at ECF 2–6 [Doc. No. 56-2].
Although more explicit in its description of the hypothesized connection between Leqembi and
Patient 3’s death, the December 2022 ScienceInsider article acknowledged that “an autopsy,
which could confirm that [Patient 3] had [the AD hallmark of] [cerebral amyloid angiopathy] and
clarify [Leqembi’s] role in her death,” had not yet been completed. Suppl. Lewis Decl. Ex. 29, at
ECF 5 [Doc. No. 56-3]. Where scientific uncertainty colored even the purportedly contrary
17 The publication also stated that, within this group, one neurologist reported being “confident
[Patient 3’s seizure] was a side effect from” Leqembi and opined that “the failure of Eisai and
Biogen to disclose [Patient 3’s] case” during Eisai’s November 2022 conference presentation
was “concerning and undermines my confidence that the reported safety data is complete.” Id.
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opinions cited by Plaintiffs, such opinions do not demonstrate, or give rise to an inference of,
falsity in Biogen and Eisai’s conclusions.
More fundamentally, however, Plaintiffs have not sufficiently alleged that the factual
basis of Biogen and Eisai’s scientific opinion at issue was itself false. “A statement of opinion is
not misleading just because external facts show the opinion to be incorrect.” Omnicare, 575 U.S.
at 188. Although Plaintiffs, and perhaps many in the scientific community, disagree that the non-
Leqembi factors to which Eisai and Biogen point were the more likely causes of death for
Patients 1, 2, and 3 than Leqembi-associated ARIA, disagreement with the company’s findings is
not enough to find them misleading. See City of Edinburgh, 754 F.3d at 170); Kleinman, 706
F.3d at 154 (“[Plaintiff] (and others) may take issue with Defendants’ researchers and scientists,
but where a defendant’s competing analysis or interpretation of data is itself reasonable, there is
no false statement.”).
Accordingly, in the absence of well-pleaded facts indicating that Biogen did not or could
not believe that the three patient deaths were not attributable to Leqembi, or that this conclusion
was the product of something other than a meaningful inquiry into the available data, Plaintiffs
claims as to Biogen’s cause-of-death statements do not meet the requisite pleading standard.
iii. 	Related Statements by Defendants Viehbacher and Singhal
In a similar vein, Plaintiffs point to statements in which Viehbacher or Singhal expressed
confidence in Leqembi’s safety profile. See Am. Compl. ¶¶ 295, 296, 298 [Doc. No. 43]. During
a quarterly earnings call on July 25, 2023, Viehbacher stated that he “th[ought] the safety benefit
of [Leqembi] [would] be quite important to physicians as we go forward.” Id. ¶ 295. This
statement, which merely asserted that physicians would consider the safety of Leqembi in
making treatment decisions, is the type of truism that is “so general” that both “a reasonable
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investor” and “the market as a whole” would find it “unimportant to the total mix of
information.” In re Wayfair, Inc. Sec. Litig., 471 F. Supp. 3d at 339 (quotation omitted).
On the same call, Singhal, in response to an analyst’s question regarding the
“mechanism” of ARIA, offered the following explanation and comparison to donanemab, an
alternative AD therapy:
So, overall, I think we don’t fully understand the mechanism of ARIA, but the data
have been replicated for Leqembi in terms of a low incidence of ARIA, in the sense
that when you compare it with some of the other anti-amyloid/anti-beta
amyloid antibodies, it is significantly lower and replicated twice.
So, for example, in the Clarity AD study, we had an ARIA-E rate of about
12.6%, but with donanemab, we see an ARIA-E rate of 24%, a very similar
sort of proportions with ARIA-H. So, I think that it also depends on the
population that has been recruited. And as [Viehbacher] mentioned, these
populations have been slightly different with MCI being -- and the early
population because we really believe that patients need to be treated earlier. So that
could be playing a role. . . . What I think we can say is that the observation that
the incidence is significantly different. And therefore, I believe that the benefit
risk is also different. And that, I think, is what doctors should be looking at.
Id. ¶ 296. Roughly one year later, while speaking on another earnings call in August 2024,
Singhal stated, in relevant part, that “thousands of patients have now been treated with
[Leqembi] globally, providing further real-world evidence on the efficacy and manageable safety
profile.” Id. ¶ 298.
Singhal’s statements in July 2023 regarding the “mechanism” of ARIA and the
donanemab comparator is not sufficiently alleged to be false insofar as Plaintiffs challenge the
reported ARIA rates observed in the Leqembi Phase 3 study and in comparable donanemab
studies. There is no indication, for example, that these rates were incorrect or misleading, or that
the Leqembi-associated ARIA rate was not, in fact, lower than the donanemab-associated ARIA
rate. See Premca Extra Income Fund LP, 763 F. Supp. 3d at 148. To the extent Singhal’s
statements are properly classified as scientific opinions, Plaintiffs offer no specific facts from
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which to infer that Singhal or Biogen did not believe that the incidence of ARIA and the “benefit
risk” were different for Leqembi versus alternatives, were aware of facts contrary to this
conclusion, or failed to make a proper inquiry into the relevant issues and data. See Constr.
Indus. & Laborers, 22 F.4th at 7 (citation omitted).
Plaintiffs’ allegations as to Singhal’s August 2024 statement are similarly deficient.
Plaintiffs fail to allege specific facts indicating that Leqembi’s benefits and risks were somehow
unmanageable or unfavorable relative to the unspecified AD treatment alternatives to which
Plaintiffs refer beyond the repetitive assertions regarding the deaths of Patients 1, 2, and 3
discussed above. See Am. Compl. ¶ 299 [Doc. No. 43] (asserting the statement was misleading
“to the extent [that Defendants] speak about the safety ‘benefit’ of Leqembi relative to other AD
therapies”). The language surrounding the challenged August 2024 statement also provides
context from which a reasonable investor would conclude that Leqembi was not without safety
risks, as Singhal clearly referenced CHMP’s “negative opinion” on Leqembi. See id. ¶ 298.
Plaintiffs have therefore failed to provide the court with a basis on which to infer that Singhal’s
August 2024 statement was false or misleading, or that additional disclosures were needed.
b. 	Phase 3 Subset Study Disclosures
Plaintiffs assert that the statements made by Biogen and Eisai in their March 2023 press
release regarding the relationship between Leqembi, blood thinners, and ARIA were false,
misleading, or omitted material facts insofar as they did not reference the deaths of Patients 1, 2,
or 3––all of whom carried the ApoE4 allele and were “either on or administered anticoagulant
medication at the time of death.” See Am. Compl. ¶¶ 290–91 [Doc. No. 43]. Plaintiffs do not
challenge the accuracy or truthfulness of those statements, including that ARIA rates “may be
slightly lower” in Leqembi patients on blood thinners compared with those only taking Leqembi
and that, in the overall study, ARIA “did not occur more frequently” in those taking blood
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thinners than those who were not. See id. ¶ 290. Accordingly, the court assesses only whether
Biogen and Eisai’s March 2023 press release statements were “so incomplete as to mislead.”
Backman, 910 F.2d at 16 (quotation omitted).
The First Circuit has “established that a company is not, by virtue of making some
disclosures about its products, obligated to disclose all potentially interesting information.”
Thant, 43 F.4th at 226 (citation omitted). Here, although investors may have been interested in
the ApoE4 carrier status or pharmaceutical regimens of Patients 1, 2, and 3, that alone is not
sufficient to render Biogen’s disclosures as to the statistical findings of the subset study or the
overall study misleading. See id. Plaintiffs have also offered nothing to suggest that the deaths of
Patients 1, 2, and 3 were not considered in the calculation of the ARIA rates presented in the
March 2023 press release––in other words, that these three deceased individuals were on blood
thinners and developed ARIA while participating in the Leqembi clinical trial does not speak to
the ARIA occurrence rate observed in that trial or calculated in the subset study.
Plaintiffs also challenge similar statements made by Singhal during a quarterly earnings
call in April 2023. See Am. Compl. ¶ 292 [Doc. No. 43] (“The results [of the subset study] were
encouraging and showed that ARIA incidents were similar in the two groups.”); id. ¶ 293 (with
respect to ARIA in carriers of two ApoE4 alleles, “[Eisai] believe[s] that really the data set was
rather small. The number of ApoE4 homozygotes was quite small. They don’t believe that the
overall conclusions are different in terms of [the Phase 3 study] and confidence in the data.”).
But, again, where Plaintiffs do not challenge the accuracy of the data and conclusions
communicated by Singhal in these statements, they have not adequately demonstrated that the
disclosure of specific information regarding Patients 1, 2, and 3 was necessary to render
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Singhal’s statements not “so incomplete as to mislead.” Backman, 910 F.2d at 16 (quotation
omitted); see Thant, 43 F.4th at 226.
4. 	Statements About Industry Positioning, MS Drug Competition, and PBMs
Plaintiffs challenge thirty-eight statements related to Biogen’s sales of Tecfidera and
Vumerity, relationship with PBMs, and MS pharmaceutical competition during the putative
Class Period. See Am. Compl. ¶¶ 225–26, 228, 230, 232, 234–35, 237–39, 241–42, 244, 247,
250–52, 254–56, 258–60, 262–64, 266–68, 270–72, 274–76, 278, 280–81 [Doc. No. 43]. These
statements can be broadly sorted into three categories: (1) statements about the competitive
environment in which Biogen was selling Tecfidera and Vumerity; (2) statements explaining
Biogen’s operating results; and (3) statements concerning the function of managed care and
PBM rebates in Biogen’s sales model.
a. 	Competitive Environment
Within this category, Plaintiffs’ central premise is that Biogen entered various
anticompetitive pricing contracts with PBMs to protect its Tecfidera sales and bolster its
Vumerity sales. Rather than disclose these contractual arrangements, however, Biogen gave
investors the false impression that it was competing meritoriously with other MS
pharmaceuticals, including new generic entrants, and doing so successfully. In Plaintiffs’ words,
such statements were false or misleading when made, or omitted necessary material facts, insofar
as Biogen did not disclose that:
(i) beginning in mid-2020, it entered into rebate contracts with PBMs to incentivize
them to favor brand name Tecfidera over lower-cost generic versions of Tecfidera
on their formularies or otherwise exclude generic Tecfidera from their formularies;
(ii) many PBMs elected to do so to maximize their financial gain on the fees
associated with the rebates offered by Biogen in such contracts; (iii) this
significantly impaired legitimate competition from generic versions of Tecfidera;
and (iv) the diminished competition from generic versions of Tecfidera, in turn,
enabled Biogen to continue selling Tecfidera at supracompetitive prices and
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volumes and switch patients from Tecfidera to Vumerity through the end of 2022.
Id. ¶ 227; see id. ¶¶ 229, 231, 233, 236, 240, 243, 245 (raising the same or similar claims with
respect to other statements).
Plaintiffs apply this logic across distinguishable statement types. Many of the challenged
statements, such as Vounatsos’ September 2020 assertion that Biogen “compete[s]” and “ha[s]
opportunities and tactics to do things the right way––the Biogen way––to compete[,]” id. ¶ 225,
fall under the umbrella of nonactionable corporate optimism or puffery. See Thant, 43 F.4th at
223; In re Wayfair, Inc. Sec. Litig., 471 F. Supp. 3d at 338–39; see, e.g., Am. Compl. ¶ 226
[Doc. No. 43] (“As long as we can innovate, we continue to do well”); id. ¶ 235 (“We believe
[Vumerity’s revenue] performance is a testament to a strong product profile and our team’s
ability to execute well, validating our plan announced mid last year to accelerate the launch of
Vumerity.”); id. ¶ 241 (“As a company, we always welcome competition, the way we did for
MS[.]”); see also id. ¶¶ 230, 232, 237, 239, 242, 244.
Other statements in this subcategory present Biogen’s quarterly and annual financial
results, including Biogen’s repeated explanations that period-over-period revenue declines in a
particular drug category were mainly attributable to reduced Tecfidera demand and downward
pricing pressure exerted by generic entrants. See id. ¶ 228 (“During the third quarter of 2020,
[Biogen] began to experience the impact of multiple Tecfidera generic entrants in the U.S., and
this [updated] financial guidance assumes significant erosion of Tecfidera in the fourth quarter of
2020, the pace of which is difficult to predict.”);18 id. ¶ 234 (“Our first quarter 2021 results were
18 To the extent this statement laid out financial guidance as to Biogen’s full-year performance in
fiscal year 2020, such information is best characterized as a financial projection falling under the
ambit of the PSLRA’s statutory safe harbor. See 15 U.S.C. § 78u-5(i)(1)(A), (C); Metzler Asset
Mgmt. GmbH v. Kingsley, 305 F. Supp. 3d 181, 211 (D. Mass. 2018).
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consistent with our expectations across MS . . . despite increased competition.”); id. ¶ 238 (“We
continue to face competition from Tecfidera generics in the U.S., which impacted our year-over-
year financial performance.”). Where Plaintiffs allege that Biogen’s MS product revenue, which
necessarily includes Tecfidera sales, declined annually every year since 2018 and discuss in
detail the threat to Tecfidera posed by generic entrants, see id. ¶¶ 48–56, Plaintiffs’ claims that
Biogen’s statements explaining such declines were somehow specious are untenable. See, e.g.,
Zhou, 120 F.4th at 293 (no plausible allegation that statement involving timing of resin’s FDA
clearance “was either false or misleading” where plaintiff “acknowledge[d] that [defendant’s
resin product] was cleared by the FDA” in the challenged time period and “d[id] not allege that
[the defendant] published” an announcement as to the FDA’s decision “before the clearance
date”); ACA Fin. Guar. Corp., 512 F.3d at 63 (no misrepresentation established where
challenged statement “clearly stat[ed]” an intention on part of defendant opposite to that which
plaintiff argued); Hill, 638 F.3d at 59 (company executives “had no obligation” to make public
expert opinions that company’s reimbursement strategy would fail “simply because they
mentioned the risks associated with non-reimbursement by third-party payers in a profit
statement”).
But, even setting the finer distinctions aside, Plaintiffs’ claims––whether directed at
inactionable statements of corporate optimism or statements not sufficiently alleged to be false––
cannot meet the requisite pleading standard where they simply lack internal coherence.
As illuminated during a hearing before this court, Plaintiffs vacillate between
characterizing Biogen’s PBM rebate activity as a violation of federal antitrust and anti-kickback
laws, as indicated in their Amended Complaint [Doc. No. 43], or as untoward market behavior
that, although not necessarily illegal, involved undisclosed market manipulation designed to
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stymie generic Tecfidera competition. Compare, e.g., Am. Compl. ¶ 158 [Doc. No. 43] (“[B]y
June 2021, generic Tecfidera accounted for less than a third of all sales. Thus, just as Biogen
intended, its collusive conduct [with PBMs] significantly slowed the erosion of Tecfidera sales
and allowed it [to] maintain a dominant market position.”) and id. ¶ 155 (“Biogen paid kickbacks
to the PBMs to impair competition from generic versions of Tecfidera. The rebates and fees it
paid were . . . enormous payments to their faithless agents, the PBMs[.]”), with Opp’n 10 [Doc.
No. 55] (“Plaintiffs claims do not depend on a violation of law, much less the antitrust laws.”)
and id. at 10 n.2 (“[T]he primary focus of those averments is that the statements gave the
impression that Biogen was competing with Tecfidera generics “on the merits,” rather than
suppressing their ability to compete at all.”). In viewing the pleadings in the light most favorable
to Plaintiffs, the court will construe Plaintiffs’ claims as asserting anticompetitive, but not illegal,
conduct on Biogen’s part. See Butler v. Balolia, 736 F.3d 609, 617 (1st Cir. 2013).19
Even characterizing Plaintiffs’ charge as asserting that Biogen acted underhandedly, but
not illegally, in its dealings with PBMs, Plaintiffs fail to connect such activity with an unfulfilled
disclosure obligation. “When making a voluntary disclosure, a company that reveals one fact is
not required to ‘reveal all others that, too, would be interesting, market-wise.’” Zhou, 120 F.4th
at 294 (quoting Backman, 910 F.2d at 16). Instead, the PSLRA requires only that a company
“reveal the facts necessary to make the existing statement not so incomplete as to mislead.” Id.
(quotation omitted). Put simply, if a statement “leaves no impression” about a particular matter,
it cannot give rise to a disclosure obligation as to that matter. See id. (“The challenged statement
is not incomplete or misleading for failing to admit that some . . . resin was produced at a non-
19 Plaintiffs’ request to further amend their pleading “to make this clear if necessary[,]” Opp’n 10
n.2 [Doc. No. 55], is denied as moot.
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compliant facility because the statement itself leaves no impression about [defendant’s
subsidiary’s] regulatory compliance.”); Gill v. Bluebird Bio, Inc., 784 F. Supp. 3d 422, 432 (D.
Mass. 2025) (reasonable investors could not have been misled into believing that the FDA would
not require a “black box warning” for a medical therapeutic where challenged statement “gave
no impression as to whether the FDA would require such a warning. . . .”).
Here, none of the statements challenged by Plaintiffs raise, reference, or even allude to
Biogen’s contracts and rebate agreements with PBMs. Accordingly, where Biogen’s statements
could not have given investors any impression as to the company’s relationships with PBMs or
use of such relationships to stave off generic Tecfidera competition, no concurrent obligation to
disclose such information attached. See Zhou, 120 F.4th at 294; Gill, 784 F. Supp. 3d at 422.
Plaintiffs’ invocation of various investigations, court cases, and confidential witness
statements do little to bolster their claims regarding Biogen’s purported manipulation of the MS
drug market via PBM agreements. As a baseline issue for Plaintiffs, none of the external legal or
administrative processes to which Plaintiffs cite have resulted in formal findings regarding, or
adjudications of, Biogen’s liability for the conduct Plaintiffs allege.20
20 See Am. Compl. ¶¶ 132, 139–40 (referencing a 2019 House of Representatives investigation
and a 2022 FTC investigation into pharmaceutical rebate agreements, as well as a 2024 FTC
administrative complaint filed against the three largest PBMs); id. ¶ 318 (noting that publicly
released documents from the 2022 FTC investigation indicate that the agency requested
documents on Tecfidera rebates); id. ¶¶ 366–67, 399–400 (describing two whistleblower actions
filed against Biogen, both of which ultimately ended in settlements); id. ¶ 328 (citing a 2024
House report, in which Tecfidera was “addressed” in documents produced by a major PBM in
response to inquiries from the House).
In January 2026, Plaintiffs filed a Notice of Supplemental Authority in Opposition to [the]
Motion to Dismiss [Doc. No. 67], in which they point the court to an opinion and order issued in
In re Tecfidera Antitrust Litigation, No. 24-cv-7387 (N.D. Ill.). See Notice 1 [Doc. No. 67]. In
that case, the court denied Biogen’s motion to dismiss a complaint filed by a group of health
benefit plans and health benefit plan sponsors alleging that “Biogen bribed PBMs to direct
Plaintiffs’ members away from generic dimethyl fumarate and towards Biogen’s more expensive
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Similarly, the confidential witnesses on which Plaintiffs rely offer little more than general
observations and information concerning Biogen’s rebate contract strategy and interest in
switching patients from Tecfidera. Confidential Witness 3, for example, asserted that, under a
strategy that “came from the ‘corporate level’” at Biogen, Biogen’s sales associates were
instructed to “‘try to transfer as many patients as possible from Tecfidera to Vumerity’ in the
United States.” Am. Compl. ¶ 67 [Doc. No. 43]. Confidential Witness 5 “confirmed that Biogen,
like any major pharmaceutical company, had a Pricing Committee consisting of ‘senior’
executives to review and approve drug prices and price changes[,]” with Confidential Witnesses
1 (“CW1”) and 2 (“CW2”) adding that “all” price changes required approval from Biogen’s
“Head of U.S. Market Access” and, in some instances, “other senior executives.” Id. ¶ 147.
CW2 and Confidential Witness 4 (“CW4”) do provide information that more explicitly
references the “brand-over-generic” rebate contracts with which Plaintiffs take issue, but they do
not do so in a manner sufficient to support the inferences on which Plaintiffs’ claims rely. CW4,
for instance, referenced a phone call on which Defendant Vounatsos allegedly stated that Biogen
was “going to raise prices on every drug we’ve been doing R&D on because we pay a fee to the
PBMs” and secondhand information she received from Biogen’s Vice President of Government
Affairs indicating Vounatsos believed this strategy “would be acceptable (to public opinion)[.]”
Id. ¶ 145. But, even assuming arguendo, that this information could give rise to an actionable
inference, it must be discounted where CW4 did not work at Biogen during the Class Period. See
brand products [i.e., Tecfidera and Vumerity], causing Plaintiffs to buy more of Biogen’s drugs
at higher prices than they would have otherwise.” Notice, Ex. A, at 1 [Doc. No. 67-1]. The order
and opinion, as a decision on a Rule 12(b)(6) motion, takes as true all well-pleaded facts in the
plaintiffs’ complaint and makes no factual findings.
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Abiomed, 778 F.3d at 245 (no “firsthand knowledge of the state of mind of [defendant’s
management]” during the class period where confidential witness did not work for the defendant
during that period).
CW2, who was employed by Biogen during the Class Period, explained that, after
Biogen’s Tecfidera patents were invalidated, the company “moved quickly to implement
‘[brand-over-generic] contracts . . . where the PBMs were paid to continue to dispense Tecfidera
instead of generic.’” Am. Compl. ¶ 146. [Doc. No. 43]. According to CW2, “‘most of the big
PBMs’ agreed to the [brand-over-generic] contracts[,]” which “ensured that the PBMs would
make more money from Biogen when Tecfidera was dispensed instead of generics.” Id. The
“prevailing view” at Biogen “was that it was better to receiv[e] 50 percent of what was
previously earned than nothing at all.” Id.
Although this information allows for a reasonable inference that Biogen engaged PBMs
in rebate agreements intended to benefit its own sales, it does not support an inference that such
agreements gave rise to a disclosure obligation about the purportedly dubious nature of these
agreements. Again, Biogen was not required to reveal information about which its statements left
“no impression[,]” Zhou, 120 F.4th at 294––and, in particular, it had no obligation under Section
10(b) or Rule 10b-5 to accuse itself of misconduct. See Abiomed, 778 F.3d at 244 (“perverse
result” if defendant company was required to “affirmatively admit[] widespread wrongdoing”
with respect to a yet-undecided regulatory matter with the FDA); Hill¸638 F.3d at 59 (company
principals “had no obligation” to make public negative expert opinions as to new reimbursement
strategy “simply because they mentioned the risk associated with non-reimbursement by third-
party payers in a profit statement”); In re Citigroup, Inc. Sec. Litig., 330 F. Supp. 2d 367, 377
(S.D.N.Y. 2004) (“[T]he federal securities laws do not require a company to accuse itself of
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wrongdoing.”), aff’d sub nom. Albert Fadem Tr. v. Citigroup, Inc., 165 Fed. App’x 928 (2d Cir.
2006).
b. 	Explanations of Operating Results
Plaintiffs also challenge twenty-three statements in which Biogen, through its Form
10-Qs, Form 10-Ks, and quarterly earnings calls, discussed the drivers of its operating results,
particularly with respect to its reduced revenue. Biogen’s October 21, 2020 Form 10-Q, for
example, stated:
Biogen had another solid quarter despite the recent entrance of generic Tecfidera
and the continued impacts of COVID-19, as we continue to execute well. . . . Total
revenue for Q3 was $3.4 billion, a decline of 6% versus the prior year. This decline
was mostly driven by Tecfidera generic entry and is inclusive of a 1%
unfavorable currency impact. Total MS revenue, including Ocrevus royalties, was
$2.3 billion, a decrease of 4% versus the prior year. MS revenue during the third
quarter began to experience the impact of the entrance of multiple generics of
Tecfidera in the U.S. while Q3 Tecfidera revenue outside the U.S. was $283
million, representing an increase of 1% versus the prior year with continued patient
growth.
Am. Compl. ¶ 250 [Doc. No. 43]. Similarly, Biogen’s April 22, 2021 Form 10-Q stated:
Product revenue, net totaled $2,211.7 million for the first quarter of 2021,
representing a $692.9 million, or 23.9%, decrease compared to $2,904.6 million in
the same period in 2020. This decrease was primarily due to a $634.2 million, or
30.0%, decrease in MS product revenue and a $44.5 million, or 7.9%, decrease in
SPINRAZA product revenue.
The decrease in MS product revenue was primarily due to a decrease in U.S.
Tecfidera demand as well as higher discounts and allowances as a result of
multiple Tecfidera generic entrants in the U.S. market.
. . . .
Fumarate revenues include sales from TECFIDERA and VUMERITY. . . . For the
three months ended March 31, 2021, compared to the same period in 2020, the
decrease of 69.6% in U.S. Fumarate revenue was primarily due to a decrease
in Tecfidera demand as well as higher discounts and allowances as a result of
multiple Tecfidera generic entrants in the U.S. market. Additionally, revenue
in the first quarter of 2020 reflected higher volume associated with additional
shipping days. The decrease was partially offset by an increase in Vumerity
sales volume.
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Id. ¶ 260; see id. ¶¶ 251–52, 254–56, 258–59, 262–64, 266–68, 270–72, 274, 276, 278, 280
(challenging similar statements).
As with the subset of statements involving the competitive environment for Biogen’s MS
pharmaceuticals, discussed supra, Plaintiffs allege that these statements are false or misleading,
or otherwise omit material facts necessary for the statements to not mislead, because they do not
disclose Biogen’s anticompetitive rebate agreements with PBMs. See, e.g., id. ¶¶ 253, 257, 261,
265. Plaintiffs allege that Biogen could not honestly attribute its revenue results to the erosion of
Tecfidera sales and, later, the “partial[] offset” of increasing Vumerity sales where the true cause
of its results was “Biogen’s entry into illicit rebate contracts” that permitted Biogen to sell
Tecfidera at “supracompetitive volumes and prices” and “switch patients to Vumerity.” Id.
¶¶ 253, 257. Plaintiffs argue that, even if the challenged statements are “not technically
untrue[,]” id. ¶ 253, they “gave the false impression that Biogen was experiencing the impact of
unimpaired competition from Tecfidera generics.” Id.
Plaintiffs again fail to sufficiently plead that the content of the actual statements they
challenge are false or misleading––they do not, for example, plausibly allege that generic
versions of Tecfidera were not, in fact, cannibalizing Biogen’s Tecfidera sales or that Vumerity
sales were neither increasing as presented nor helping to counteract falling Tecfidera sales. See
Zhou, 120 F.4th at 293; ACA Fin. Guar. Corp., 512 F.3d at 63. Insofar as Plaintiffs claim that the
statements omitted material information regarding Biogen’s rebate agreements with PBMs,
Biogen had no obligation to raise this information where these statements gave investors “no
impression” as to such arrangements and where the disclosures Plaintiffs desired would have
effectively compelled Biogen to unnecessarily accuse itself of wrongdoing. See Zhou, 120 F.4th
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at 294; Abiomed, 778 F.3d at 244; Hill, 638 F.3d at 59; In re Citigroup, Inc. Sec. Litig., 330 F.
Supp. 2d at 377.
c. 	Function of Rebates in Biogen’s Sales Model
Finally, Plaintiffs challenge statements that specifically refer to rebates as a factor in
Biogen’s revenue. Am. Compl. ¶¶ 247, 282 [Doc. No. 43]. Plaintiffs again assert that Biogen
misattributed its product revenue performance to declining Tecfidera sales and the offsetting
increase in Vumerity sales, rather than Biogen’s “illicit rebate contracts” with PBMs. Id. The
earliest statement Plaintiffs challenge, from Biogen’s 2020 Form 10-K, provided in relevant part:
Product revenue reserves, which are classified as a reduction in product revenues,
are generally characterized in the following categories: discounts, contractual
adjustments and returns.
. . . .
Contractual adjustments primarily relate to Medicaid and managed care rebates,
pharmacy rebates, co-payment (copay) assistance, Veterans Administration (VA)
and Public Health Service (PHS) discounts, specialty pharmacy program fees and
other governmental rebates or applicable allowances. . . . Managed care rebates
represent our estimated obligations to third parties, primarily pharmacy benefit
managers. Rebate accruals are recorded in the same period the related revenue is
recognized, resulting in a reduction of product revenue and the establishment of a
liability which is included in accrued expenses and other current liabilities. These
rebates result from performance-based goals, formulary position and price
increase limit allowances (price protection). The calculation of the accrual for
these rebates is based on an estimate of the coverage patterns and the resulting
applicable contractual rebate rate(s) to be earned over a contractual period.
Id. ¶ 247 [Doc. No. 43]. Plaintiffs allege that “[t]he same or substantially similar
statements . . . were made in the 2021 Form 10-K and the 2022 Form 10-K.” Id. ¶ 248.
As with the statements evaluated above, Plaintiffs do not explain how investors could
have been misled by this statement, which explains the source of, and accounting methodology
concerning, rebate accruals embedded in Biogen’s sales model. If anything, this statement aligns
with Plaintiffs’ overarching assertion that Biogen made use of rebate agreements to improve
Biogen pharmaceuticals’ position on drug formularies and protect the prices of its products
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relative to competitors––the statement even goes so far as to describe rebates, in part, as “price
protection.” See In re The First Marblehead Corp. Sec. Litig., 639 F. Supp. 2d at 155 (no
actionable claim can be “predicated on the concealment of information if that information was,
in fact, disclosed.”). Insofar as Plaintiffs challenge this statement based on purported omissions,
Biogen was, again, not required to accuse itself of wrongdoing in the manner Plaintiffs suggest.
See Abiomed, 778 F.3d at 244; In re Citigroup, Inc. Sec. Litig., 330 F. Supp. 2d at 377.
The next challenged statement appeared only in Biogen’s 2022 Form 10-K:
The decrease in MS product revenue of $666.5 million, or 10.9%, from
$6,096.7 million in 2021 to $5,430.2 million in 2022, was primarily due to a
decrease in Tecfidera demand as a result of multiple Tecfidera generic
entrants in North America, Brazil and certain E.U. countries, and a decrease in
Interferon demand due to competition as patients transition to higher efficacy and
oral MS therapies.
Fumarate revenue includes sales from Tecfidera and Vumerity. . . . For 2022
compared to 2021, the 13.8% decrease in U.S. Fumarate revenue was primarily
due to a decrease in Tecfidera demand as a result of multiple Tecfidera generic
entrants in the U.S. market, partially offset by net price increases in Tecfidera
driven 	by 	lower 	pharmacy 	rebates, 	managed 	care 	rebates 	and 	co-pay
assistance as well as an increase in Vumerity sales volumes.
Am. Compl. ¶ 281 [Doc. No. 43]. Where Plaintiffs have also alleged that Biogen disclosed its
use of rebate contracts, including by referring to these contracts as “price protection[,]” in both
the same Form 10-K and in two prior Form 10-Ks, see id. ¶ 247, this statement is neither
misleading nor did it create an additional disclosure obligation on Biogen’s part. See Zhou, 120
F.4th at 294; ACA Fin. Guar. Corp., 512 F.3d at 62; Hill, 638 F.3d at 59.
B. 	Scienter
As the preceding discussion indicates, Plaintiffs have not sufficiently alleged that any of
the fifty-six statements included in the Amended Complaint [Doc. No. 43] are actionable under
the PSLRA. But, even if Plaintiffs had alleged actionable statements or omissions, Plaintiffs
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must also “state with particularity facts giving rise to a strong inference” of scienter. 15 U.S.C.
§ 78u-4(b)(2). Plaintiffs have failed to do so here.
For the purposes of the PSLRA, scienter is “a mental state embracing intent to deceive,
manipulate, or defraud.” Matrixx, 563 U.S. at 48 (quoting Tellabs, Inc., 551 U.S. at 319). It
requires “a showing of either conscious intent to defraud or a high degree of recklessness.” ACA
Fin. Guar. Corp., 512 F.3d at 58. Plaintiffs must plead “the basis for inferring scienter[,]”
Cardinale, 567 F.3d at 13, and such an inference “must be more than merely plausible or
reasonable[,]” Tellabs, Inc., 551 U.S. at 314.
The court must engage in a holistic inquiry, in which it considers “whether all of the facts
alleged, taken collectively, give rise to a strong inference of scienter[.]” Id. at 323. “‘Strong’
need not be ‘irrefutable,’ the Supreme Court has emphasized, but must be ‘cogent and at least as
compelling as any opposing inference one could draw from the facts alleged.’” State Tchrs. Ret.
Sys. of Ohio v. Charles River Lab’ys Int’l, Inc., 152 F.4th 1, 12–13 (1st Cir. 2025) (quoting
Tellabs, Inc., 551 U.S. at 324).
1. 	Leqembi’s Commercial Prospects
With respect to statements regarding the 10,000 patient goal for, and general commercial
rollout of, Leqembi, Plaintiffs anchor their scienter allegations to information from confidential
witnesses and Defendants’ purported body of commercial knowledge arising from Biogen’s
failed Aduhelm launch and Biogen’s participation in joint committees with Eisai during the
Leqembi development and launch processes. See, e.g., Am. Compl. ¶¶ 212–21, 379–83 [Doc.
No. 43]. “The key question . . . is not whether defendants had knowledge of certain undisclosed
facts, . . . but rather whether defendants knew or should have known that their failure to disclose
those facts presented a danger of misleading buyers or sellers.” City of Dearborn Heights, 632
F.3d at 758 (citation omitted).
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Insofar as Plaintiffs depend on confidential witnesses to demonstrate scienter, for many
of the reasons indicated supra, the confidential witnesses were not properly positioned to offer
reliable information as to Defendants’ knowledge or state of mind. Where, for example, CW8
and CW10 never worked for Biogen, and where Plaintiffs do not allege that CW9 and CW11
ever interacted with the Individual Defendants or were privy to sufficiently specific information
in support of Plaintiffs’ claims, Plaintiffs’ reliance is misplaced. See Abiomed, 778 F.3d at 245;
Coyne, 943 F. Supp. 2d at 267, 271; see also Collier, 9 F. Supp. 3d at 72 (confidential witnesses
must offer “specific descriptions of the precise means through which [alleged fraud] occurred,
provided by persons said to have personal knowledge of them.” (quotation omitted)). To the
extent the CWs do attempt to speak to what Defendants knew or believed, their assertions reflect
the CWs’ own knowledge or beliefs, rather than that of the Defendants. See, e.g., Am. Compl.
¶ 220 [Doc. No. 43] (referring to CW11’s opinion that Biogen’s approach to financial analysis
does not properly consider relevant constraints and “look[s] at issues like system constraints as a
‘tomorrow problem’”); id. ¶ 221 (noting that CW9 was “surprised” by the 10,000 patient goal
timeline and thought it was “very suspicious”); id. (reporting that CW11 “agreed that the 10,000
[p]atient [g]oal was ‘crazy’”).
Plaintiffs are not helped by their broader assertions of scienter via Biogen’s Aduhelm
experience and formal collaboration with Eisai. For example, Plaintiffs point to statements made
by Defendants McDonnell and Singhal indicating that Biogen shared its “learnings[,] . . . be they
development learnings or commercial learnings[,]” from the failed Aduhelm commercialization
with Eisai. See id. ¶ 212 (quoting McDonnell on September 12, 2022, and October 25, 2022); id.
(quoting Singhal on December 1, 2022). But Plaintiffs are unable to offer more than broad
generalizations as to what such “learnings” were, nor do they draw any connections between
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specific alleged mistakes in the Leqembi rollout to specific alleged mistakes in the Aduhelm
rollout. See, e.g., id. ¶¶ 213–14 (alleging that Viehbacher “consistently recognized since starting
as CEO that Leqembi faced the same challenges” as Aduhelm where the president of Biogen’s
United States operations commented on a July 2021 call that “building this infrastructure for the
appropriate use of Aduhelm will require time” and “each site will operationalize at different
rates”). In any event, where several statements challenged by Plaintiffs include Biogen’s own
references to uncertainty in the Leqembi rollout,21 Plaintiffs have not demonstrated that
Defendants sought to intentionally mislead investors, or did so recklessly, with respect to
Leqembi’s rollout. As between Plaintiffs’ desired inference and the alternative inference that
Defendants believed they were progressing toward their commercialization goals even “if fitfully
at times[,]” In re Genzyme Corp., Nos. 09-11267-GAO, 09-11299-GAO, 2012 WL 1076124, at
*12 (D. Mass. Mar. 30, 2012), aff’d sub nom. In re Genzyme Corp. Sec. Litig., 754 F.3d 31 (1st
Cir. 2014), the latter is the more compelling.
Finally, Plaintiffs’ gestures toward Eisai and Biogen’s formal collaboration agreements,
joint committees, and other avenues of information-sharing do not push their scienter allegations
above the conclusory level. In sum, Plaintiffs’ factual allegations, taken as true at this stage,
sufficiently posit that Biogen and Eisai worked very closely on the launch of Leqembi,
Defendants Vounatsos and Viehbacher spoke regularly with Eisai’s leadership about Leqembi,
21 See, e.g., id. ¶ 303 (describing the Leqembi launch as “a heavy lift at the start” insofar as it
involved coordination with physician practices); id. ¶ 304 (explaining that Biogen “know[s] [the
Leqembi launch] is going to be choppy up before [the date set for attaining the 10,000 patient
goal] and there’ll be some centers that are off to the races and some that will take longer and it’s
kind of hard to predict, to be honest, how fast it’s going to go”); id. ¶ 315 (acknowledging that
Biogen’s patient registry data was “not perfect information” where the company lacked “direct
access to the patient registries”).
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and, at least via Defendant Singhal’s position as chair of the companies’ joint steering
committee, Biogen and Eisai likely both participated in setting of the 10,000 patient goal. See
Am. Compl. ¶¶ 379–83 [Doc. No. 43]. But these assertions, even when read together with the
confidential witness allegations and Aduhelm-related allegations described supra, still do not
give rise to the requisite antecedent inference that Defendants knew or should have known that
the Leqembi commercialization would not meet Biogen’s publicly stated goals, let alone that
they knew or should have known that their failure to provide such information could mislead
investors. See City of Dearborn Heights, 632 F.3d at 758; see also Yan v. ReWalk Robotics Ltd.,
973 F.3d 22, 41 (1st Cir. 2020) (“[M]ere knowledge of facts is insufficient to support a strong
inference of scienter . . . . There must be some allegation strongly implying that defendants had
reason to believe their omissions to be fraudulent.”).
2. 	Leqembi’s Safety Profile
As a threshold issue, where Biogen’s statements concerning or incorporating Eisai’s
explanations or analyses of the results of the Phase 3 Leqembi study constitute inactionable
statements of scientific opinion, Plaintiffs have, for the reasons described supra, failed to
plausibly allege that Defendants did not believe these assessments or were aware of information
rendering the bases of such assessments objectively incorrect. See Brill v. Invivyd, Inc.,
No. 1:23-CV-10254-JEK, 2024 WL 4228832, at *9 (D. Mass. Sep. 18, 2024). To the extent
Plaintiffs again wish to rely on the existence of various information-sharing pathways between
Biogen and Eisai, their assertions are equally unpersuasive here given the lack of specificity
therein. See Am. Compl. ¶¶ 375–78, 381–82 [Doc. No. 43]. Plaintiffs nonetheless attempt to
further ground their scienter allegations in commentary from third parties included in news and
industry articles and assertions made by two confidential witnesses.
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First, the cited publicly available articles detailing the deaths of Patients 1, 2, and 3 and
critiquing Eisai’s conclusions as to the associated causes of death cannot support the inference
that Biogen, by virtue of the existence of these articles, was “on constructive notice” that “at
least three patient deaths” were connected to Leqembi. See id. ¶¶ 373–74; Brennan v. Zafgen,
Inc., 853 F.3d 606, 614 (1st Cir. 2017) (finding argument that defendants “knew, or were
reckless in not knowing, about news and scientific articles that purportedly established a ‘link’
between [a pharmaceutical] and the occurrence of thrombotic adverse events” unpersuasive and
insufficient to “support a strong inference of scienter under either a conscious intent or
recklessness theory”).
Second, the assertions of CW6 and CW7 on which Plaintiffs rely lack sufficient
connection to Defendants’ state of mind. CW6, a neuropathologist and professor of pathology,
treated Patient 2 in the emergency room in the days prior to her death and witnessed Patient 2
“screaming and writhing in pain” after she was administered a blood thinner. Am. Compl. ¶¶ 17,
189 [Doc. No. 43]. “No later than the end of 2022[,]” CW6 performed an autopsy on Patient 2,
during which CW6 discovered “brain swelling and frayed blood vessels” and “concluded that the
cause of death was multifocal intracerebral hemorrhage due to Leqembi infusion complicated by
the fact that she appeared to have a stroke, leading to the use of [a blood thinner].” Id. ¶ 194.
Plaintiffs allege that CW6, while attending a conference, informed Eisai’s Senior Medical
Science Liaison about his findings and offered to “share the full autopsy details and discuss in
detail.” Id. ¶ 195. The Liaison declined CW6’s offer but “said he would speak to ‘senior people’
on the Leqembi team and they would get back to him.” Id. “Later, [the Liaison] sent an email
attempting to rebut the link to Leqembi[,]” but there was otherwise no follow-up from Eisai with
respect to CW6’s alert. Id.
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Similarly, CW7, a vascular neurologist and AD researcher, performed an autopsy on
Patient 3 in March 2023, during which CW7 “discovered more than 30 microbleeds in Patient
3’s brain[,]” “widespread inflammation[,]” “areas of dead or ‘necrotic’ tissue,” and “blood
vessels that appeared shredded and deformed.” Id. ¶¶ 18, 196. CW7 concluded that Patient 3’s
cause of death was “‘necrotizing vasculitis’ related to treatment with Leqembi.” Id. ¶ 196. In
“late March to early April 2023[,]” CW7 “provided a copy of the autopsy report to a scientific
journalist, who, in turn, sen[t] a copy to Eisai’s public relation department.” Id. ¶ 197. CW7 also
“sent copies of the autopsy report to numerous scientists who work with Eisai and ‘senior
executives’ at Eisai[,]” along with an offer “to share all materials, including tissue slides, so Eisai
and Biogen could review them.” Id. As alleged by CW7, “Eisai’s response was ‘very slow, very
limited, and did not occur in a timeframe when it might be helpful to the FDA approval
process.’” Id.
The court does not discount CW6 and CW7’s medical opinions as to the causes of death
for Patients 2 and 3. But the relevant inquiry for scienter turns on whether Plaintiffs sufficiently
allege that Biogen or any Individual Defendants were aware of facts supporting these medical
opinions, to the exclusion of accepting Eisai’s opinions, and proceeded to make public
statements that recklessly disregarded such facts or were made with the intent to deceive
investors as to this information. See In re Stone & Webster, 414 F.3d at 214 (scienter not
sufficiently pleaded where plaintiffs needed to allege “particularized facts which give strong
support” to conclusion that “defendant knew the true facts, or knew that the challenged statement
was false”); Tharp v. Acacia Comm’ns, Inc., 321 F. Supp. 3d 206, 229 (D. Mass. 2018)
(rejecting scienter allegation where proposed amended complaint did not “contain specific
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allegations to show that the Defendants knew or were reckless in not knowing that any
statements were false when made”).
Plaintiffs have not done so here. Where CW6 and CW7 did not provide, or attempt to
provide, their respective autopsy reports to Biogen or the Individual Defendants, there can be no
inference that Defendants were in receipt of the relevant information. To the extent Plaintiffs rely
on an inferential chain that connects CW6 and CW7’s actions to the Defendants, this, too, fails––
neither CW6’s provision of Patient 2’s autopsy report on an unknown date to an unnamed Eisai
employee, nor CW7’s reliance on a “scientific journalist” and unknown “scientists who work
with Eisai [and unnamed Eisai] senior executives” to somehow deliver Patient 3’s autopsy report
to Eisai, sufficiently support the necessary inference that Biogen or any Individual Defendant
was at some point apprised of the relevant information by Eisai. See In re Stone & Webster, 414
F.3d at 214; Tharp, 321 F. Supp. 3d at 229; see also In re Psychemedics Corp. Sec. Litig., No.
17-10186-RGS, 2017 WL 5159212, at *5 (D. Mass. Nov. 7, 2017) (“It is an altogether different
proposition to say that the fraudulent actions or statements undertaken by corporate officers in
Company A can support not only a claim of scienter against Company A, but also against
Company B, absent an alter-ego relationship.”).
3. 	Industry Positioning, MS Drug Competition, and PBMs
With respect to Tecfidera, Vumerity, and Defendants’ alleged participation in “brand-
over-generic” rebate agreements with PBMs, Plaintiffs attempt to plead scienter by reference to,
inter alia, confidential witness allegations, Vounatsos and McDonnell’s purported awareness of
PBM contracts in the broader marketplace, and the centrality of Tecfidera and Vumerity to
Biogen’s business. Even when considered together, these allegations are insufficient to plead
scienter under the PSLRA.
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As with Plaintiffs’ other attempts to rely on confidential witnesses, the confidential
witness allegations here give little support for scienter. Neither CW3 nor CW5 offer information
beyond generalities concerning Biogen’s pricing and sales strategies for Tecfidera and Vumerity.
See, e.g., Am. Compl. ¶¶ 67, 147 [Doc. No. 43]. Equally unavailing are the allegations attributed
to CW4, who did not work at Biogen during the Class Period, or to CW2, whose assertions as to
the use and purpose of PBM rebate contracts are consistent with Defendants’ public statements
on the topic. See id. ¶¶ 15, 145–46. Compare id. ¶ 146 (under the rebate agreements, per CW2,
“PBMs were paid to continue to dispense Tecfidera instead of generic” and would therefore
“make more money from Biogen when Tecfidera was dispensed instead of generics”), with id.
¶ 247 (relaying that Biogen, in regulatory filings, described rebates as “result[ing] from
performance-based goals, formulary position and price increase limit allowances (price
protection)”).
The court also notes that the confidential witnesses did not hold officer-level or similar
leadership positions at Biogen during the Class Period; do not allege that they reported to
individuals in such positions, including the Individual Defendants; and do not allege that they
spoke to, or interacted with, the Individual Defendants. In the absence of any such allegations,
there is no basis on which to conclude the CWs can credibly speak to the knowledge, beliefs, or
state of mind of any Individual Defendant. See Abiomed, 778 F.3d at 245; In re iRobot Corp.
Sec. Litig., 527 F. Supp. 3d 124, 142 (D. Mass. 2021) (determining that a confidential witness
“not . . . alleged to have interaction with upper management” could not “be considered to present
a strong inference for scienter”); In re Biogen Inc. Sec. Litig., 193 F. Supp. 3d at 46 (finding no
scienter in part because none of the main confidential witnesses, “most of whom were . . . five
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levels removed from any of the defendants[,]” nor any other confidential witness “ever spoke
with one of the defendants”).
Similarly, Plaintiffs’ attempt to plead scienter based on Defendant Vounatsos’s
participation in various industry trade groups, descriptions of Biogen’s PBM contracts, and,
along with Defendant McDonnell, purported awareness of two pre-2020 whistleblower suits is
unsuccessful. First, Plaintiffs’ attempt to link Vounatsos’s board membership with the
Pharmaceutical Research and Manufacturers of America (“PhRMA”) from 2016 to 2022, see
Am. Compl. ¶ 8 [Doc. No. 43]; the launch of the aforementioned House investigation in August
2017 directed at pharmaceutical price increases, see id. ¶ 355; and PhRMA’s November 2017
report on such price increases relative to PBM incentives, see id. ¶ 356, amounts to little more
than conjecture as to “any firsthand knowledge” Vounatsos possessed with respect to the specific
rebate agreements with which Plaintiffs take issue. See, e.g., Luongo v. Desktop Metal, Inc.,
No. 1:21-cv-12099-IT, 2023 WL 6142715, at *14 (D. Mass. Sept. 20, 2023) (rejecting plaintiffs’
“attempt to extrapolate from the fact that [defendant] frequently attended and/or ran sales
meetings that he was privy to information about manufacturing practices and product quality”
(quotation omitted)).
To the extent Vounatsos or McDonnell were likewise “aware” of the two qui tam
complaints against Biogen unsealed in July 2015 and March 2017, see Am. Compl. ¶¶ 366–70
[Doc. No. 43], Plaintiffs likewise fail to demonstrate that any such knowledge––which, given the
nature of the two complaints, would have concerned Biogen’s alleged payment of kickbacks to
physicians and to cover Medicare copays, rather than any such payment to PBMs––pertained to
what Defendants knew or should have known relative to the alleged impropriety of Biogen’s
PBM rebate contracts. See Luongo, 2023 WL 6142715, at *14.
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Plaintiffs also assert that Vounatsos’s public statements between December 2016 and
September 2021 “confirm[ed] that he stayed informed on PBM contracting for Biog[en]’s MS
products, including Tecfidera.” Am. Compl. ¶ 357 [Doc. No. 43]. Vounatsos made all but one of
these “confirmatory” statements prior to the start of the Class Period. See id. ¶¶ 358–64 (citing to
statements made in December 2016, March 2017, July 2017, October 2017, May 2018, June
2018, January 2020, and July 2020); cf. In re Biogen Sec. Litig., 857 F.3d at 44 (statements made
by defendants “well after the end of the Class Period” did not “provide particularized insight into
the defendants’ knowledge at the time of the alleged misstatements”). With respect to the only
statement made during the Class Period, Vounatsos, when asked at an investment conference
about a pending appeal involving a Tecfidera patent, “[c]omment[ed] on the effect of a positive
decision . . . stat[ing] ‘we need to see the implications in terms of the PBMs and other partners.’”
Am. Compl. ¶ 365 [Doc. No. 43]. Such a general statement does not suffice for the scienter
analysis.
Finally, although they do not label them as such, Plaintiffs raise “core operations”
allegations. Through such allegations, Plaintiff assert that the indispensability of Tecfidera and
“the launch of a new AD franchise” to Biogen during the Class Period weighs in favor of a
strong inference that Defendants either knew or were reckless in not knowing that their
statements regarding Tecfidera, Vumerity, and Leqembi were misleading. Id. ¶¶ 398–403; see In
re Biogen Inc. Sec. Litig., 193 F. Supp. 3d at 51 (describing the role of “core operations”
allegations in similar suits).
“[U]nder [Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308 (2007)], the ‘core
operations’ allegations” and the significance of Tecfidera, Vumerity, and Leqembi to Biogen’s
business “must be taken into account as part of the Court’s assessment of the scienter
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allegations.” Id. Typically, however, courts are “hesitant to apply significant weight to ‘core
operations’ allegations without other significant evidence of a defendant’s intent or recklessness,
or a ‘plus factor.’” Metzler Asset Mgmt. GmbH, 305 F. Supp. 3d at 219 (citations omitted).
Here, where the foregoing analysis demonstrates the relative weakness of Plaintiffs’ other
evidence regarding scienter, and where there is otherwise “no ‘smoking gun’ evidence or ‘plus
factor[,]’” Plaintiffs’ “core operations” allegations add little to the scienter analysis. Id.; see In re
Biogen Inc. Sec. Litig., 193 F. Supp. 3d at 51; see also In re A123 Sys., Inc. Sec. Litig., 930 F.
Supp. 2d 278, 285 (D. Mass. 2013) (concluding that “core operations” allegations were
meaningful in Crowell v. Ionics, Inc., 343 F. Supp. 2d 1 (D. Mass. 2004), because there were
also “allegations of the improper booking and accounting of fraudulent sales, buttressed by a
‘plus factor’––an e-mail pointing to the company’s vice president as the author of the scheme”).
4. 	Stock Sales Allegations and Role of Corporate Incentives
As additional support for their scienter allegations, Plaintiffs assert that the Individual
Defendants “stood to gain enormously from hiding anticompetitive practices and difficulties
launching Leqembi” by virtue of their “stock and option incentives” and “performance-based
cash incentives.” Am. Compl. ¶ 384 [Doc. No. 43].
Plaintiffs allege, and Defendants do not dispute, that performance-based cash incentives
were calculated based on a weighted basket of metrics, including “achieving MS global market
share[,]” “leading MS in customer trust and value surveys[,]” “preparing for AD leadership[,]”
“executing on Critical Alzheimer’s Disease Initiatives[,]” and “launch readiness and execution of
Leqembi[.]” Id. ¶¶ 386–89 (describing the factors considered for Biogen’s cash incentives in
2020, 2021, 2022, and 2023). But where Plaintiffs “do not plead any additional or unusual facts
concerning the company’s executive compensation or the Individuals Defendants’ receipt of
compensation under the company’s pay packages[,]” the allegations, “[s]tanding alone, . . . are,
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therefore, insufficient.” In re Atl. Power Corp. Sec. Litig., 98 F. Supp. 3d 119, 133 (D. Mass.
2015); see Aldridge v. A.T. Cross Corp., 284 F.3d 72, 83 (1st Cir. 2002) (fact that corporate
officers’ compensation depended on company’s earnings “alone is not and cannot be enough to
establish scienter”); Greebel, 194 F.3d at 197 (“[C]atch-all allegations that defendants stood to
benefit from wrongdoing and had the opportunity to implement a fraudulent scheme are not
sufficient.” (quotation omitted)).
Plaintiffs also assert that Defendants Vounatsos, McDonnell, and Singhal’s sales of
Biogen stock are probative of scienter relative to the Defendants’ “motivat[ion] to engage in a
fraudulent course of conduct so that they could sell their share[s] at artificially inflated prices
throughout the Class Period.” Am. Compl. ¶ 392 [Doc. No. 43]. During the putative Class
Period, Vounatsos sold 32,830 shares and “reaped proceeds of nearly $6.44 million.” Id. ¶ 393.
In the four years prior to the putative Class Period, Plaintiffs allege that Vounatsos sold “8,061
shares for proceeds of $2,483,115.60[,]” id. ¶ 394, which Plaintiffs emphasize was “less than a
quarter of the shares sold during the Class Period,” id.
Plaintiffs also allege that during the putative Class Period, McDonnell sold 16,740 shares
and “reaped proceeds of nearly $4.25 million[,]” id. ¶ 395; and Defendant Singhal sold 7,814
shares and “reaped proceeds of nearly $1.92 million[,]” id. ¶ 396. Plaintiffs do not make any
allegations in the Amended Complaint [Doc. No. 43] as to any trading activity prior to the
putative Class Period. See id. ¶¶ 395–97; Greebel, 194 F.3d at 198 (“At a minimum, [insider
trading pleaded] . . . must be unusual, well beyond the normal patterns of trading by those
defendants.”); Lenartz v. American Superconductor Corp., 879 F. Supp. 2d 167, 186 (D. Mass.
2012) (plaintiff “bears the burden of showing that insider sales were in fact unusual or suspicious
in timing or amount[,]” which “requires the plaintiff to provide information on the defendant’s
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trading both before and after the class period, so the court can assess the sales in context”
(citation omitted)).22
Defendants contend that Plaintiffs fail to allege facts sufficient to overcome the
inference, based on Vounatsos and McDonnell’s regulatory filings, that “they only made
automatic sales to satisfy tax obligations from vesting stock” or the inference that the stock sales
attributed to Singhal, also based on her regulatory filings, “were either automatic sales to satisfy
tax obligations from vesting stock or non-discretionary sales made pursuant to 10b5-1 plan.”
Mem. ISO Mot. to Dismiss 33 [Doc. No. 50]. Plaintiffs disagree with the characterization of the
stock sales as tax-based or non-discretionary. See Opp’n 34 [Doc. No. 55].
The court need not settle this debate or wade further into Plaintiffs’ insider trading
allegations. “[W]hile such insider trading may be ‘probative of scienter[,]’ it is not sufficient to
establish an inference of scienter on its own.” In re Ariad Pharms., Inc. Sec. Litig., 842 F.3d at
754 (quoting Greebel, 194 F.3d at 197–98); see Quinones v. Frequency Therapeutics, Inc., 106
F.4th 177, 184 (1st Cir. 2024). Thus, Vounatsos, McDonnell, and Singhal’s stock sales during
the putative Class Period are of no moment where Plaintiffs have otherwise failed, as the
preceding analysis demonstrates, to sufficiently allege facts that support an inference of scienter.
V. 	Count II – Violation of Section 20(a) of the Exchange Act
Section 20(a) “imposes joint and several liability on persons in control of entities that
violate securities laws.” Abiomed, 778 F.3d at 246 (citing 15 U.S.C. § 78t(a)). But where the
Amended Complaint [Doc. No. 43] fails to allege an underlying violation of federal securities
22 In their Opposition [Doc. No. 55], Plaintiffs state that McDonnell “did not have any trading
activity before the start of the Class Period[.]” Id. at 34. McDonnell was not employed by Biogen
prior to 2020, see Am Compl. ¶ 10 [Doc. No. 43], so the absence of trading activity prior to the
putative Class Period shows nothing suspicious.
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law, for the reasons described supra, the Section 20(a) claim must also be dismissed. See Zhou,
120 F.4th at 296; Abiomed, 778 F.3d at 246; Greebel, 194 F.3d at 207.
VI. 	Conclusion
For the foregoing reasons, Defendants’ Motion to Dismiss [Doc. No. 48] is GRANTED.
Plaintiffs’ Amended Complaint [Doc. No. 43] is DISMISSED with prejudice.
IT IS SO ORDERED.
March 26, 2026 	/s/ Indira Talwani
United States District Judge
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