Buxton Helmsley Releases Evidence of Product-Related Fraud at Assertio

Rhea-AI Summary

The Buxton Helmsley Group (BHG), which holds a short position in Assertio Holdings (NASDAQ: ASRT), has released evidence supporting allegations of product-related fraud at Spectrum Pharmaceuticals, now owned by Assertio. The evidence includes a memo showing requests to delete adverse event data and audit reports revealing major discrepancies in clinical trial data. BHG has filed a whistleblower complaint with the SEC and calls on Assertio's board to release their full investigation report and documentation of communication with whistleblowers. BHG claims Assertio's recent denial fails to address specific allegations, including alleged 'hush money' offers to whistleblowers.

Positive

• None.

Negative

• Evidence of alleged product-related fraud at Spectrum Pharmaceuticals
• Documentation showing requests to delete adverse event data
• Major discrepancies found in clinical trial data
• Inadequate training of clinical trial staff reported
• Whistleblower complaint filed with SEC
• Questions raised about due diligence in Spectrum acquisition

Insights

Legal & Compliance Expert

The allegations of clinical trial data manipulation and adverse event deletion at Spectrum Pharmaceuticals (now owned by Assertio) represent serious regulatory concerns. The released evidence, including audit reports showing "Major" discrepancies and alleged attempts to delete adverse event data, could trigger significant FDA scrutiny and potential SEC investigations. This poses substantial risks including:

• Potential regulatory enforcement actions and fines
• Product approval challenges or withdrawals
• Securities fraud litigation exposure
• Reputational damage affecting market confidence

The company's response lacking specific rebuttals to the allegations and apparent failure to engage with whistleblowers raises red flags about internal controls and compliance protocols. The situation could materially impact $90.5M market cap Assertio's financial position and operational viability if the allegations are substantiated.

Market Research Analyst

This whistleblower complaint and evidence release represents a significant development that could severely impact Assertio's market position. Key concerns include:

• The potential invalidation of clinical trial data could affect multiple product approvals
• Legal and regulatory costs could strain the company's financial resources
• The allegations may impact relationships with healthcare providers and payers

The market is likely to react negatively to these developments, particularly given the company's relatively small market capitalization and the comprehensive nature of the allegations. Investors should monitor regulatory responses and any potential impact on product revenues closely.

Evidence Corroborates Allegations of Multiple Former Executives

Calls on Assertio Board to Release Full Investigation Report and Supporting Materials

NEW YORK--(BUSINESS WIRE)-- The Buxton Helmsley Group, Inc. (together with certain of its affiliates, “BHG” or “we”), a New York City-based investment fund manager that has inverted its long equity position into that of a short interest in the publicly traded securities of Assertio Holdings, Inc. (“Assertio” or the “Company”) (NASDAQ: ASRT), today responded to the Company’s attempt to deny, in its November 11, 2024, press release, the evident product-related fraud at Spectrum Pharmaceuticals, Inc., now wholly-owned by Assertio.

“The statement from Assertio this morning is a blanket response that, tellingly, does not even bother to rebut BHG’s specific allegations—it does not even deny the ‘hush money’ offers to whistleblowers. Instead, the Company is attempting to ‘shoot the messenger’ instead of addressing its failure to properly investigate these matters. Assertio apparently wishes to continue its evident product-related fraud that, as a byproduct, also appears to be defrauding Assertio investors. In defense of the validity of BHG’s claims, we have released an initial set of evidence so that shareholders and regulators can judge for themselves where the truth lies,” said Alexander Parker, Senior Managing Director of BHG.

“For example, within the evidence set we have released, shareholders will see a memo from Spectrum’s former Executive Director of Clinical Operations to Spectrum’s former SVP of Clinical Development and former SVP of Clinical Science about a request to delete adverse event data from Spectrum’s database, which is fraudulent conduct. The pages from site audit reports reveal ‘Major’ discrepancies in clinical trial data and cite insufficient training for clinical trial staff. Although whistleblowers sent Assertio’s leadership those site audit reports in private e-mails, Assertio is still issuing statements that say Spectrum’s clinical trials were not ‘Major[ly]’ flawed across multiple products. The site audit reports tell the real story, and this is just one example of the full volume of material we will hand over to regulators.

“Given the misleading claims from Assertio to date, particularly the claim that the Company investigated the corroborating whistleblower allegations, we call on Mr. O’Grady and the rest of Assertio’s board of directors to release: (i) the full report of its investigation; (ii) documentation that it actually communicated with the whistleblowers; and (iii) documentation confirming it obtained materials from the whistleblowers. Shareholders will note that the investigation, if it ever occurred at all, never collected or reviewed the whistleblowers’ supporting evidence – the Company did not even communicate with the whistleblowers in writing. BHG believes this raises substantial questions about the validity of the investigation’s conclusions and the judgment of the board, which accepted the investigation report.

“If the Assertio board’s preferred path is to continue denying the fraud at Spectrum and the pathetically inadequate due diligence leading up to the Spectrum acquisition, we agree with Assertio that regulatory attention is warranted. For its part, BHG is already seeking to engage with the U.S. SEC about these matters, having filed a whistleblower complaint with the agency. The materials we are prepared to turn over include the evidence released to stockholders today, supplemented by vast additional material possessed by the Spectrum whistleblowers.

“The next step will be made by the Assertio board. If they wish to acknowledge reality and pivot to seek to cure the Company and the board’s related liability, we will applaud their decision to reverse course and accept responsibility for past mistakes. If they continue to deny the validity of our evidence-backed assertions, we will continue taking steps to cast light on their considerable evident malfeasance,” concluded Parker.

An initial set of the referenced evidence, which has been reviewed by legal counsel, may be found at: https://www.buxtonhelmsley.com/asrt/

***

About Buxton Helmsley

The Buxton Helmsley Group, Inc. (“BHG”) is a New York City-based investment advisory firm and fund manager, engaging both active and passive investment strategies across a range of asset classes, with a general focus on opportunities in North America and Europe. The investment approach is based on deep fundamental analysis and risk management, with a focus on ensuring disclosure obligations are being upheld under applicable accounting standards and securities laws.

Disclosure: BHG holds a short position in the securities of ASSERTIO HOLDINGS, INC. (NASDAQ:ASRT)

Legal Disclaimer:
The use of BHG’s research and analysis is at your own risk. In no event will BHG or any affiliated party be liable for any direct or indirect trading losses caused by any information in this press release. You further must do your own research and due diligence, and consult with your own financial, legal, and tax advisors before making any investment decision with respect to transacting in any securities covered herein. You should assume that as of the publication date of this communication, BHG (possibly along with or through our members, partners, affiliates, employees, and/or consultants) has a short position in the stock, bonds, derivatives or securities covered herein, and therefore stands to realize significant gains in the event that the price of the securities of the issuer discussed in this press release declines. Following publication of this press release, BHG intends to continue transacting in the securities discussed herein, and may be long, short, or neutral at any time thereafter regardless of BHG’s initial position or views. BHG’s investments are subject to its risk management guidance, which may result in the de-risking of some or all of its positions at any time following publication of any report or letter depending on security-specific, market or other relevant conditions. This is not an offer to sell or a solicitation of an offer to buy any security, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction. BHG is registered as an investment advisor with the State of New York. To the best of BHG’s knowledge and belief, and except as otherwise described herein, all information contained herein is accurate and reliable, and has been obtained from public sources believed to be accurate and reliable, and who are not currently insiders or, to BHG’s knowledge, who may otherwise owe any fiduciary duty or duty of confidentiality to the issuer discussed in this press release. Such information is presented “as is,” without warranty of any kind – whether express or implied. BHG makes no representation, express or implied, as to the accuracy, timeliness, or completeness of any information contained herein, or with regard to the results to be obtained from its use. All expressions of opinion are subject to change without notice, and BHG does not undertake to update or supplement this report or any of the information contained herein or its position in any securities.

Cautionary Statement Regarding Forward-Looking Statements:
The information herein contains “forward-looking statements.” Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and include, without limitation, words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “potential,” “targets,” “forecasts,” “seeks,” “could,” “should” or the negative of such terms or other variations on such terms or comparable terminology. Similarly, statements that describe our objectives, plans or goals are forward-looking. Forward-looking statements are subject to various risks and uncertainties and assumptions. There can be no assurance that any idea or assumption herein is, or will be proven, correct or that any of the objectives, plans or goals stated herein will ultimately be undertaken or achieved. If one or more of such risks or uncertainties materialize, or if BHG’s underlying assumptions prove to be incorrect, the actual results may vary materially from outcomes indicated or suggested by these statements. Accordingly, forward-looking statements should not be regarded as a representation by BHG that the future plans, estimates or expectations contemplated will ever be achieved.

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Media:

Buxton Helmsley Group

Press@BuxtonHelmsley.com

Source: The Buxton Helmsley Group, Inc.

FAQ

What evidence of fraud did Buxton Helmsley Group release about Assertio (ASRT)?

BHG released evidence including a memo showing requests to delete adverse event data and site audit reports revealing major discrepancies in clinical trial data at Spectrum Pharmaceuticals, now owned by Assertio.

What regulatory action is being taken against Assertio (ASRT)?

BHG has filed a whistleblower complaint with the SEC regarding the alleged product-related fraud at Spectrum Pharmaceuticals, now owned by Assertio.

What is Buxton Helmsley Group demanding from Assertio (ASRT)?

BHG is demanding Assertio's board release the full investigation report, documentation of communications with whistleblowers, and confirmation they obtained materials from whistleblowers.