Cell Pathways Settles Suits Over Cancer Drug

Cell Pathways Inc. said it agreed to pay $2 million and provide additional shares to settle lawsuits by shareholders who said false statements about a new cancer drug caused a 70% drop in the stock price.

Stockholders filed 11 proposed class-action suits in federal court in Philadelphia in March and April, contending that the Horsham, Pa.-based biotechnology company misled the public about the safety and effectiveness of Aptosyn to treat intestinal polyps.

The company denied any wrongdoing and said it will provide 1.7 million shares of common stock and $2 million.

Cell Pathways shares fell 5 cents to $4.69 on Nasdaq.