Regeneron Pharmaceuticals Inc. said Thursday that it is thetarget of a class-action lawsuit related to its April 2 initialpublic offering.

The suit demands repayment of the purchase price ofRegeneron stock bought between April 2 and May 15 withinterest plus other relief. Regeneron stock fell to $10.75 onMay 15 from its initial offering price of $22. The IPO grossed$99 million.

The stock (NASDAQ:REGN) closed at $11.88, down 25 cents onThursday.

According to the complaint, Regeneron's registrationstatement and prospectus "omitted to discuss or give adequateprominence and emphasis to" the company's pro forma loss forthe quarter ended March 31 compared with the year earlier and"painted instead a rosy picture emphasizing the growth of thecompany." As a result, the suit alleges that the companymisled investors "into believing that the company's resultswould improve."

The Tarrytown, N.Y., company had a loss of $1.1 million, or 7cents a share, for the first quarter of 1991, compared with aloss of $913,000, or 6 cents a share, for the first quarter of1990.

"We believe the allegations in this complaint are without basisin fact and intend to vigorously defend the company's positionin court," said Regeneron general counsel Paul Lubetkin. Nocourt date has been set.

A number of biotech analysts have said lead underwriterMerrill Lynch & Co. overpriced the offering because thecompany is still several years away from clinical trials.Regeneron is developing compounds to treat neurodegenerativediseases, peripheral neuropathies and nerve injuries.

Defendants in the suit include Regeneron, directors of thecompany and Merrill Lynch. The suit was filed May 16 byRichard Schwarzschild in U.S. District Court in the SouthernDistrict of New York.

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