A class action lawsuit was filed against Biohaven Ltd. (BHVN) by Levi & Korsinsky on July 14, 2025. The plaintiffs (shareholders) alleged that they bought BHVN stock at artificially inflated prices between March 24, 2023, and May 14, 2025 (Class Period) and are now seeking compensation for their financial losses. Investors who bought Biohaven stock during that period can click here to learn about joining the lawsuit.
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Biohaven is a biopharmaceutical company focused on developing and commercializing novel treatments targeted at neuroscience, immunology, and oncology. Biohaven is developing troriluzole for the treatment of spinocerebellar ataxia (SCA) and BHV-7000 for the treatment of bipolar disorder.
The company’s claims about troriluzole’s viability and regulatory prospects as a treatment for SCA are at the heart of the current complaint.
Biohaven’s Misleading Claims
According to the lawsuit, Biohaven and two of its senior officers (the Defendants) repeatedly made false and misleading public statements throughout the Class Period. In particular, they are accused of omitting truthful information about troriluzole’s regulatory prospects as a treatment for SCA, and BHV-7000’s efficacy and clinical prospects as a treatment for bipolar disorder, from SEC filings and related material.
During the Class Period, the company highlighted the topline results from a Phase 3 clinical trial assessing the efficacy and safety of its investigational therapy, troriluzole, in patients with SCA. Furthermore, Biohaven stated that although the study’s primary endpoint did not achieve statistical significance in the overall SCA population, a post hoc analysis of efficacy measures by genotype indicated a potential treatment effect in patients with the SCA Type 3 genotype.
Additionally, in an annual report, Biohaven noted that considering the endpoint results and the “debilitating nature of SCA,” the company intended to interact with the U.S. Food and Drug Administration (FDA) and/or the European Medicines Agency (EMA) in the first half of 2023.
Finally, in a May 31, 2023, press release, the company reported consistent treatment benefits of troriluzole in SCA3 patients in Study BHV4157-206, showing improvements in key measures and a strong reduction in fall risk.
However, subsequent events (detailed below) reveal that the defendants failed to inform investors that the efficacy and clinical prospects of troriluzole and BHV-7000 were likely overstated and could have a negative impact on Biohaven’s business and financial condition.
Plaintiffs’ Arguments
The plaintiffs maintain that the defendants deceived investors by lying and withholding critical information about the company’s business practices and prospects during the Class Period. Importantly, the defendants are accused of misleading investors about the regulatory aspects and treatment indication of Biohaven’s lead drug candidates.
The information became clear on May 14, 2025, when Biohaven announced that the Division of Neurology 1 within FDA’s Office of Neuroscience was extending the Prescription Drug User Fee Act (PDUFA) date for the troriluzole New Drug Application (NDA) for treating SCA by three months to allow a full review of Biohaven’s recent submissions in response to FDA information requests.
The company also said the Division plans to hold an advisory committee meeting to review the application, but no date has been set yet. Following the news, BHVN stock fell 19.5% the next day.
To conclude, the defendants failed to inform investors about the potential negative impact on Biohaven’s business and financial condition following the FDA’s extended review timeline. Due to these issues, BHVN stock has lost 58.2% so far this year.
