The legal action follows a turbulent period for the software provider, which saw its stock price drop by over 24% in June 2025 after slashing its annual revenue guidance. The company cited market uncertainties and project cancellations among its pharmaceutical clientele, but subsequent disclosures triggered further instability. By mid-July, Simulations Plus reported a $67.3 million net loss, largely driven by a $77.2 million non-cash impairment charge.

Simultaneously, the firm terminated its relationship with independent auditor Grant Thornton LLP. In a formal SEC filing, the accounting firm disputed the company's characterization of the departure, stating that critical issues regarding internal financial controls and segment reporting remained unresolved at the time of their dismissal. This revelation contributed to an additional 26% slide in the company's share price, prompting the current inquiry into whether management failed to disclose material information to the market.