Class Action Lawsuit Filed Against Aardvark Therapeutics Over Drug Safety Disclosures

A securities class action has been filed against Aardvark Therapeutics Inc., accusing the clinical-stage biopharmaceutical company of making materially false and misleading statements about the safety and prospects of its lead drug candidate, ARD-101. The lawsuit, announced by multiple shareholder rights firms on August 17, 2026, targets investors who purchased Aardvark common stock in its February 13, 2025 initial public offering or acquired securities between that date and May 14, 2026.

The complaint, filed in the U.S. District Court for the Southern District of California, centers on ARD-101, a small-molecule agonist of bitter taste receptors (TAS2Rs) being developed for hyperphagia in Prader-Willi Syndrome. The class period spans from the IPO through May 14, 2026. Investors have until October 13, 2026 to seek appointment as lead plaintiff.

**Allegations of Undisclosed Safety Risks**

According to the lawsuit, Aardvark’s offering documents and subsequent public statements failed to disclose material adverse facts. Specifically, the complaint alleges that ARD-101 was less safe than defendants had led investors to believe, and that its clinical, regulatory, and commercial prospects were therefore overstated.

Hagens Berman Sobol Shapiro LLP, one of the firms announcing the action, reported that the complaint points to undisclosed cardiac safety issues. The offering documents, the firm stated, failed to disclose that “ARD-101 was significantly less safe than defendants had led investors to believe” and that “unexpected, reversible cardiac observations (such as QRS prolongation) occurred during trials at above-target doses.”

Robbins LLP, another firm representing shareholders, noted in its announcement that Aardvark had repeatedly described ARD-101 as a “gut-restricted” small-molecule agonist. The complaint alleges that despite such characterizations, the true safety profile was not adequately communicated.

**Two Key Events Trigger Stock Collapse**

The truth began to emerge, according to the complaint, on February 27, 2026. Aardvark issued a press release announcing it was voluntarily pausing the Phase 3 Hunger Elimination or Reduction Objective (HERO) trial. The company attributed the decision to “reversible cardiac observations at above target therapeutic doses found during routine safety monitoring in a healthy volunteer study.”

On that news, Aardvark’s stock price fell $7.02 per share, or 56.2%, to close at $5.47 per share on March 2, 2026, according to filings cited in the lawsuits.

The situation worsened on May 14, 2026, when Aardvark announced that the U.S. Food and Drug Administration had placed a full clinical hold on its investigational new drug application for ARD-101. The hold applied to all ongoing studies under the IND, including the Phase 3 HERO trial and the open-label extension trial. Aardvark’s stock fell another $2.16 per share, or 32.1%, to close at $4.57 per share on May 15.

**Investor Rights and Next Steps**

The class action seeks to represent all purchasers of Aardvark securities during the class period. Four law firms — Hagens Berman Sobol Shapiro, Robbins LLP, Rosen Law Firm, and Gainey McKenna & Egleston — have issued separate announcements reminding investors of their rights.

Investors who suffered losses may be eligible to receive compensation without out-of-pocket fees through contingency fee arrangements. To serve as lead plaintiff, investors must file a motion with the court by October 13, 2026. A lead plaintiff acts as a representative for the class; investors who do not seek appointment can remain absent class members and may still share in any potential recovery.

Reed Kathrein, the Hagens Berman partner leading the firm’s investigation, said: “We’re investigating the suit’s allegations, including that Aardvark allegedly misled investors about ARD-101’s development, its safety and efficacy.”

**Broader Implications for Biotech Investors**

The case highlights the acute risks inherent in clinical-stage biotechnology investments. A single safety signal in a pivotal trial can trigger catastrophic stock losses, as the market rapidly reprices a drug candidate’s probability of success. The two-week period between the voluntary pause and the FDA clinical hold erased the vast majority of Aardvark’s market value from its IPO price.

The complaint underscores that accurate and complete disclosures about preclinical and early-stage clinical data are critical — particularly when companies emphasize favorable attributes such as a drug’s tolerability or gut-restricted mechanism without transparently addressing emerging safety signals from ongoing studies.