Wolf Popper LLP, as Court-appointed Lead Counsel in the federal securities class action In re Applied Therapeutics Securities Litigation, Case No. 1:24-cv-09715 (S.D.N.Y.), has filed a consolidated amended complaint on behalf of Lead Plaintiff Dr. Martin Dietrich and a proposed class of investors who purchased Applied Therapeutics, Inc. (“Applied,” NASDAQ: APLT) publicly traded common stock on a U.S. exchange between January 3, 2024 and December2 2, 2024 (the “Class Period”).
The Amended Complaint, filed on May 2, 2025, alleges that Applied Therapeutics and senior executives, including founder and former CEO, President, Secretary, and Chair Dr. Shoshana Shendelman and CMO Dr. Riccardo Perfetti, made materially false and misleading statements concerning Applied’s New Drug Application (“NDA”) for govorestat (AT-007), a proposed treatment for Classic Galactosemia, and interactions and communications with the U.S. Food and Drug Administration (“FDA”) concerning the NDA.
The Complaint alleges that, between March and June 2021, Applied administered only 80% of the protocol-required dose of govorestat to at least 19 or 47 participants in its pediatric trial. Despite knowing of this issue since June 2021, the Company failed to disclose these dosing errors, or the clinical data resulting from these dosing errors, to the FDA in the NDA, and instead reported doses as if they had been properly administered.
Also, on March 27, 2024, just two days after the FDA pre-announced an inspection of Applied’s clinical testing sites, a third-party vendor deleted electronic clinical outcome assessment data, and the associated audit trails, for all 47 participants in the pediatric clinical trial. As a result, the FDA was not able to verify all clinical data that supported the NDA.
The FDA discovered the dosing errors and the data deletion in its inspections of Applied’s clinical sites between April 27 and May3, 2024. On May 3, 2024, the FDA gave a Form FDA 483 to Dr. Shendelman, which detailed three objectionable conditions discovered during the inspection, including the data deletion. On May 9, 2024, Applied responded to the FDA and confirmed that it could not recovered the deleted data for 11 clinical subjects.
The Complaint alleges that the dosing errors and the data deletion were violations of FDA regulations, and compromised the FDA’s ability to assess the NDA and verify and trust the clinical data submitted in support of the NDA. Yet, throughout the Class Period, defendants made repeated public statements falsely assuring investors that the regulatory review was progressing smoothly. For example, in January and February 2024, the Company described its NDA as being supported by favorable clinical outcomes and safety data and claimed it was working closely with the FDA. During investor conferences on May 14, 2024 and September 4, 2024, then-CEO Dr. Shendelman explicitly stated that “things are going very well with the FDA” and that there were “no major sticking points” or “surprises” in the review process, despite knowing by that time that the FDA had uncovered serious issues, including the deletion of critical clinical trial data and undisclosed dosing errors, and had already issued formal inspection findings identifying regulatory violations. On September 18, 2024, Applied and Dr. Shendelman announced that the FDA had cancelled an upcoming advisory committee meeting to evaluate the NDA, and characterized this as a positive regulatory update. However, the defendants failed to disclose the known negative factors of the dosing errors and data deletion and that the FDA had discovered the data deletion through its inspection.
On November 27, 2024, after market close, Applied disclosed that the FDA issued a Complete Response Letter (“CRL”), declining to approve the NDA due to clinical deficiencies. On December 2, 2024, after market close, the Company disclosed that it had also received a Warning Letter from the FDA, which revealed that Applied had been aware of serious deficiencies as early as May 2024, but did not disclose them during the Class Period. On December 3, 2024, the FDA published Warning Letter on its website, and pharmaceutical news services covered the warning letter and rejection of the NDA on December 4 and 5, 2024.
In response to these disclosures, Applied’s stock fell from a closing price of $8.57 per share on November 27, 2024 to a closing price of $1.29 per share on December 5, 2024.
On December 20, 2024, during pre-market hours, Applied announced that on December 19, 2024, Dr. Shendelman had stepped down from her roles as President, CEO, Secretary, and Chair. In response, the price of Applied common stock fell from a closing price of $1.02 per share on December 19, 2024 to a closing price of $0.88 per share on December 20, 2024.
The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, and seeks damages for class members who were harmed by Defendants’ misconduct.
The Court has entered a Scheduling Order providing that Defendants must answer or move to dismiss the amended complaint by May 23, 2025, and that briefing on any motion to dismiss will conclude by June 27, 2025.
The case is In re Applied Therapeutics Securities Litigation, Case No. 1:24-cv-09715 (S.D.N.Y.), pending before the Honorable Denise L. Cote in the United States District Court for the Southern District of New York.
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