Overview
Cohen Milstein, as joint Lead Counsel, represents investors of Organon (“the Company”), a pharmaceutical and medical device company specializing in women’s health products, in a putative securities fraud class action against the Company and its officers for allegedly misleading investors from November 3, 2022 to April 30, 2025 (the “Class Period”).
Specifically, investors claim that Organon, its former CEO, Kevin Ali, and its CFO, Matthew Walsh, overstated how long Nexplanon, its best-selling contraceptive implant, would retain market exclusivity and be protected from generic competition. Investors claim that, in reality, regulatory developments made it easier and faster for competitors to develop biosimilar versions of Nexplanon, meaning Organon faced competition and potential revenue declines earlier than it led investors to believe. Additionally, investors allege that Organon repeatedly asserted it would continue paying a large quarterly shareholder dividend, upon which investors and analysts had come to rely, even though the Company could not afford to do so.
As a result, investors claim that the defendants misled them about the Company’s financial well-being and prospects and caused them to purchase Organon securities at artificially inflated prices.
Investors bring their claims under the Securities Exchange Act of 1934.
Important Rulings & Dates
- On March 6, 2026, Magistrate Judge Cari Fais consolidated the initial complaints and cases filed by two plaintiffs and appointed Teamsters Local 710 Pension Fund as Lead Plaintiff and Cohen Milstein as joint Lead Counsel, to lead this putative securities fraud class action.
- On May 23, 2025 and July 8, 2025, investors filed class action lawsuits against Organon titled Hauser v. Organon & Co., et al. and Lerner v. Organon & Co., et al., respectively. On July 22, 2025, Cohen Milstein moved to lead the litigation on behalf of Teamsters Local 710 Pension Fund.
Case Background
Organon is a global healthcare and medical device spinoff from Merck that went public on June 3, 2021. Organon’s women’s health division specializes in long-acting reversible contraception (LARC) products, which are highly effective forms of birth control that last for several years and can be reversed when a person wishes to become pregnant. Organon’s leading LARC, Nexplanon, is a contraceptive implant that is inserted under the skin of the upper arm and provides continuous pregnancy prevention for up to five years.
As alleged, one of the reasons Organon stock traded at a high premium was because the Company promised to pay a large quarterly dividend to its shareholders of more than $0.25 per share. Indeed, Organon executives repeatedly referred to this shareholder dividend as the Company’s “#1 cash allocation priority.” While Organon represented to investors that it could comfortably pay this dividend going forward, in reality, the Company knew of multiple factors—including, but not limited to, Organon’s outstanding debt load and Nexplanon’s slower-than-hoped sales— necessitating that Organon deprioritize the dividend in favor of other more urgent cash needs.
As the Company’s most important product, sales of Nexplanon were critical to Organon’s success. Organon told investors that Nexplanon would retain patent and regulatory exclusivity—and, thus, be immune from generic competition—through 2027 at the earliest. As alleged, however, Organon knew of regulatory developments that would allow the Company’s competitors to sell Nexplanon generics after submitting a mere six months of clinical data demonstrating the generic product’s similarity to Nexplanon, thereby permitting competitors to introduce Nexplanon biosimilars much earlier than Organon had represented to investors. Indeed, Organon even submitted a Citizen’s Petition formally requesting that the FDA impose lengthier and more stringent testing requirements on Nexplanon biosimilars, but Organon never disclosed this regulatory filing to investors.
Investors allege that Organon’s fraud began to come to light on May 1, 2025, when Organon disclosed that a rival company had initiated the regulatory process for bringing a Nexplanon biosimilar to market. Just one day later, Organon unexpectedly cut its shareholder quarterly dividend payments from $0.28 per share to $0.02 per share, contradicting the Company’s earlier promises that it could continue paying a large dividend indefinitely. These disclosures caused the price of Organon’s stock to drop from $12.90 per share on May 1 to $8.70 per share when trading reopened on May 5.
Investors allege that defendants are liable for making false statements or failing to disclose adverse facts known to them that: (i) deceived the investing public regarding Organon’s prospects and business; (ii) artificially inflated the price of Organon publicly-traded securities; and (iii) caused plaintiff and other members of the Class to purchase Organon publicly-traded securities at artificially inflated prices.