PHOENIX, July 9, 2009 (GLOBE NEWSWIRE) -- Hagens Berman Sobol Shapiro is investigating reports of possible securities law violations by Matrixx Initiatives, Inc. (Nasdaq:MTXX), the makers of Zicam products, over the drug maker's reported failure to provide the Food and Drug Administration (FDA) with more than 800 reports relating to the loss of sense of smell associated with the Zicam Cold Remedy intranasal products.
In a letter to Matrixx, dated June 16, 2007, the FDA informed Matrixx it concluded that certain Zicam products may pose serious risks to consumers who use them, and that Matrixx marketing practices violate several laws relating to the products.
It also stated that the "agency is aware that Matrixx appears to have more than 800 reports related to loss of sense of smell associated with Zicam Cold Remedy intranasal products" and directed Matrixx "to arrange submission of all reports related to loss of sense of smell associated with Zicam Cold Remedy intranasal products" and to "indicate which of these reports have been previously submitted to the FDA."
Upon release of this letter by the FDA, Matrixx stock (Nasdaq:MTXX), plummeted from approximately $19 per share to less than $7 per share. On July 23, 2009, Matrixx acknowledged the Securities and Exchange Commission (SEC) is launching an informal inquiry. Since December 2007, insiders, including the Executive VP and CFO, the VP of Sales and the VP of Research and Development, have sold more than $2.7 million worth of Matrixx shares.
According to the FDA, as of Dec. 2007, Matrixx was required to provide reports of adverse reactions to the agency per the Dietary Supplement and Nonprescription Drug Consumer Protection Act, which President Bush signed into law Dec. 22, 2006. The Act requires manufacturers, packers, or distributors whose name appears on a nonprescription drug or dietary supplement product label to notify FDA of any serious adverse event report associated with the product's use within 15 business days of receipt of such information. The industry was given a one-year grace period to begin to comply with the law.
If you are aware of any facts relating to this investigation, or purchased shares of Matrixx since December 2007, you can assist this investigation by contacting one of our attorneys at Matrixx@hbsslaw.com or joining this investigation through the firm's Web site.
You can also contact the firm through its securities Web site at www.hbsslawsecurities.com/matrixx.htm.
Hagens Berman Sobol Shapiro, a law firm with offices in Seattle, San Francisco, Los Angeles, Boston, Chicago and Phoenix is active in major litigation pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Hagens Berman Web site (www.hbsslaw.com) has more information about the firm.