A class action lawsuit was filed against Rocket Pharmaceuticals (RCKT) by Levi & Korsinsky on June 11, 2025. The plaintiffs (shareholders) alleged that they bought RCKT stock at artificially inflated prices between February 27, 2025, and May 26, 2025 (Class Period) and are now seeking compensation for their financial losses. Investors who bought Rocket Pharmaceuticals stock during that period can click here to learn about joining the lawsuit.
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Rocket Pharmaceuticals is a late-stage biotechnology company focused on developing genetic therapies to correct the root causes of complex and rare diseases.
The company’s investigational drug, RP-A501, is being developed to treat Danon disease, a rare disorder that thickens and weakens the heart’s muscles, leading to heart failure. Danon disease is considered to be more common in males and often leads to death during adolescence or early adulthood, according to Rocket’s website.
Rocket Pharmaceuticals made materially false and misleading claims about RP-A501’s safety and clinical trial protocol, which are at the heart of the current complaint.
Rocket Pharmaceuticals’ Misleading Claims
According to the lawsuit, Rocket and one of its senior executives (the Defendants) repeatedly made false and misleading public statements throughout the Class Period. In particular, they are accused of omitting truthful information about Rocket’s Phase 2 pivotal trial of RP-A501 for the treatment of Danon disease from SEC filings and related material.
During the Class Period, the company updated investors about the progress of the ongoing Phase 2 pivotal study in a press release for the fourth quarter of fiscal 2024 results. The company noted that the dosing of RP-A501 for Danon disease was on track. Furthermore, the company stated that a program update is anticipated in the first half of 2025.
Additionally, the CEO stated in the same press release that Rocket Pharmaceuticals had made strong progress in advancing its gene therapy pipeline. This progress was supported by the publication in the New England Journal of Medicine of the Phase 1 study of RP-A501 for Danon disease, as well as long-term data presented at AHA showing its safety and meaningful efficacy up to five years.
Finally, in a press release dated May 8, 2025, the company noted that the Phase 2 pivotal study was progressing well, with a program update expected by mid-2025 and a clinical data readout anticipated by mid-2026.
However, subsequent events (detailed below) reveal that the defendants failed to disclose the risks associated with the changed protocol, which included serious adverse events (SAEs) and even the death of participants enrolled in the study. Rocket Pharmaceuticals had amended the trial protocol to introduce a novel immunomodulatory agent to the pretreatment regimen without providing this critical update to shareholders.
Plaintiffs’ Arguments
The plaintiffs maintain that the defendants deceived investors by lying and withholding critical information about the business and prospects during the Class Period. Importantly, the defendants are accused of misleading investors about the potential risks associated with changing the protocol of the Phase 2 pivotal trial.
The information became clear on May 27, 2025, when Rocket Pharmaceuticals announced that the U.S. Food and Drug Administration (FDA) had placed a clinical hold on its Phase 2 pivotal study of RP-A501 after at least one patient suffered a serious adverse event (SAE) and eventually died while enrolled in the study. The FDA also stated that Rocket Pharmaceuticals had failed to disclose the protocol change to investors.
In response, the company stated that while the patient was dosed in May, it had amended the protocol “several months” earlier. Nonetheless, Rocket Pharmaceuticals did not inform investors about the change until after the SAE occurred. Following the news, RCKT stock plunged 62.8% the same day.
To conclude, the defendants failed to inform investors about the amended protocol and the risks associated thereto. As a result of these issues, RCKT stock has lost 75.7% so far this year.
