A team of Skadden, Arps, Slate, Meagher & Flom litigators last week beat back a putative federal securities class action in North Carolina against biopharmaceutical company Cempra, Inc.

The company and its top executives were sued for making allegedly false and misleading statements about the safety of the company's lead product, solithromycin. The drug is being developed for the treatment of community-acquired bacterial pneumonia (the leading cause of death due to infection in the United States).

During the class period, analysts estimated that Cempra would earn up to $2 billion a year in sales if solithromycin were approved by the FDA.

But in November of 2016, an FDA panel ruled that Cempra had not had not adequately characterized the drug's risk of liver injury. Cempra's stock dropped 9.3 percent on the news. It plunged even further in December, when the FDA said it wanted more clinical trials, and indicated that even if solithromycin was approved, its label would need to disclose scary information about risk of liver damage.

Represented by firms including Robbins Geller Rudman & Dowd, the plaintiffs sued for recovery of stock losses.

But on Oct. 26, U.S. District Judge Thomas Schroeder of the Middle District of North Carolina dismissed the suit.

He took issue with claims that Cempra made false or misleading statements, concluding that some were “little more than vague optimistic statements regarding the safety profile of the drug.”

He also noted that the defendants did in fact acknowledge that “solithromycin, like many other antibiotics, had the potential for some form of liver injury.”

“Ultimately, the court need not resolve the issue of falsity,” Schroeder concluded, “because even assuming plaintiffs have adequately alleged falsity with respect to some of the challenged statements, they fail to allege sufficient facts to establish a strong inference of scienter.”

The Skadden team was led by partners James R. Carroll and Michael S. Hines, and Lee Whitman and Samuel Slater of Wyrick Robbins Yates & Ponton LLP were co-counsel.