The litigation targets Capricor over claims that executives provided misleading statements regarding Deramiocel, a drug candidate intended to treat Duchenne muscular dystrophy. While the company touted positive results from its HOPE-3 study in December 2025—which initially sent share prices soaring by 370%—subsequent FDA disclosures painted a starkly different picture.

An FDA briefing document released on July 27, 2026, indicated that the study failed to meet its primary and secondary efficacy endpoints. Regulators revealed that Capricor had modified its statistical analysis plan without FDA agreement, altering endpoint definitions and analytical methods. This discrepancy caused the company’s stock to plummet 64% in a single day. Reed Kathrein, a partner at Hagens Berman, stated that the firm is investigating the scope of how management characterized these trial endpoints and the impact of the undisclosed modifications on shareholders.