Why are Telix Pharmaceuticals shares diving today?

Shares in this up-and-coming drug company are under pressure over law suits filed in the US.

| More on:
Scientists working in the laboratory and examining results.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Several law firms in the US have lodged class action claims against Telix.
  • They allege the company made misleading claims to the detriment of shareholders.
  • Telix is yet to respond to the claims.

Telix Pharmaceuticals Ltd (ASX: TLX) shares have dipped on Friday after news broke that several law firms had filed class actions against the company in the US.

Law firm Robbins Geller Rudman and Dowd was among the law firms that filed a claim and encouraged shareholders to join their push for damages.

Claims the company made false statements

That firm's claim, Thomas v. Telix Pharmaceuticals Ltd, alleges the company and certain of its executives breached the US Securities Exchange Act of 1934 during the period 21 February 2025 through to 28 August 2025.

The law firm says on its website:

The Telix Pharmaceuticals class action lawsuit alleges that throughout the class period defendants made false and/or misleading statement and/or failed to disclose that: (i) defendants materially overstated the progress Telix Pharmaceuticals had made with regard to prostate cancer therapeutic candidates; and (ii) defendants materially overstated the quality of Telix Pharmaceuticals' supply chain and partners.

The suit further alleges that on 22 July 2025, the company "received a subpoena from the U.S. Securities and Exchange Commission (SEC) seeking various documents and information primarily relating to the Company's disclosures regarding the development of the Company's prostate cancer therapeutics candidates".

The law firm says the company's shares, which are also listed in the US, subsequently fell more than 13% across two trading days.

Then later on 28 August, the claim says Telix "disclosed that it received a Complete Response Letter from the U.S. Food and Drug Administration ("FDA") for the Biologics License Application for its product TLX250-CDx, which identified "\'deficiencies relating to the Chemistry, Manufacturing, and Controls (CMC) package"'.

The FDA additionally 'documented notices of deficiency (Form 483) issued to two third-party manufacturing and supply chain partners that will require remediation prior to resubmission,' according to the complaint.  The Telix Pharmaceuticals class action lawsuit alleges that on this news, the price of Telix Pharmaceuticals ADSs fell more than 21% over two trading sessions.

Other law firms that have lodged similar actions include Hagens Berman Shareholder Advocates and Berger Montague.

Telix is yet to make a statement to the ASX regarding the lawsuits.  

Telix shares were trading 4.3% lower on Friday at $14.34. The shares have traded as high as $31.97 over the past year.

Telix in mid-October reported third-quarter revenue of about $206 million, up 53% on the same period the previous year and upgraded its full-year revenue guidance to $800 to $820 million.  

The company was valued at $5.07 billion at the close of trade on Thursday. Telix has been contacted for comment.

Bell Potter recently said it had a $23 price target on Telix shares.

Motley Fool contributor Cameron England has positions in Telix Pharmaceuticals. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Telix Pharmaceuticals. The Motley Fool Australia has recommended Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Healthcare Shares

woman testing substance in laboratory dish, csl share price
Share Market News

After a 73% surge this ASX healthcare share looks far from done

Brokers are upbeat, and some see possible gains of 90% in 2026.

Read more »

Female scientist working in a laboratory.
Healthcare Shares

Which biotech's shares are surging higher on US patent news?

Investors like what they see from this drug company.

Read more »

Medical workers examine an xray or scan in a hospital laboratory.
Healthcare Shares

This biotech company's shares are on a tear – again – after another contract win

A new contract with a prestigious US institution spells good news for shareholders.

Read more »

Child with superhero mask and cape flies after jumping on sofa
AI Stocks

3 of the fastest-growing stocks on the planet in 2025

These stocks soared in 2025.

Read more »

Shot of a mature scientists working on a laptop in a lab.
Healthcare Shares

Could CSL shares outperform the ASX 200 in 2026?

After shocking investors in 2025, CSL shares may be setting up for a comeback. Here’s why 2026 could look better.

Read more »

A man holds his head in his hands after seeing bad news on his laptop screen.
Healthcare Shares

Why did CSL shares crash 39% in 2025?

Should you be buying the dip? Let's find out.

Read more »

A group of people in a corporate setting do a collective high five.
Healthcare Shares

Why 4DMedical shares are jumping 14% today

4DMedical shares climb on a new CFO appointment as investors focus on US expansion and rising use of its lung…

Read more »

A business woman flexes her muscles overlooking a city scape below.
Healthcare Shares

Why I plan to buy this incredible ASX 200 stock in 2026

A 33% pullback has put Pro Medicus back in focus. Here’s why I’m preparing to buy its shares in 2026.

Read more »