SAN FRANCISCO — The U.S. Court of Appeals for the Ninth Circuit revived a stock-drop suit against Arena Pharmaceuticals Inc. on Wednesday, finding that the company inappropriately kept investors in the dark about a study that found its diet drug caused elevated instances of cancer in lab rats.
The San Diego-based pharmaceutical company saw its stock price drop by more than 40 percent in 2010 on the day that the U.S. Food and Drug Administration disclosed the study and concerns that the drug might be carcinogenic. The FDA, ultimately persuaded by the company’s explanation for what was causing the rats’ cancer, approved the drug, lorcaserin, for sale in 2012.
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