SAN DIEGO–(BUSINESS WIRE)–Shareholder rights law firm Robbins LLP announces that a purchaser of PharmaCielo Ltd. (OTC: PCLOF) filed a class action complaint against the Company for alleged violations of the Securities Exchange Act of 1934 between June 21, 2019 and March 2, 2020. PharmaCielo, through its subsidiary, PharmaCielo Colombia Holdings S.A.S., cultivates, processes, produces, and supplies medical-grade cannabis oil extracts and related products in Colombia and internationally.
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PharmaCielo Ltd. (PCLOF) Accused of Misleading Shareholders
According to the complaint, in September 2019, PharmaCielo issued a press release announcing that it “ha[d] signed a United States sales agreement with an established multi-state distributor, General Extract LLC.” Following this announcement, in November 2019, PharmaCielo released its Company’s third quarter 2019 financial statements touting that it was “nearing completion of [its] extraction and processing center (“RTC”), which will expand the Company’s extraction capacity.” While PharmaCielo’s November financial statements purported to list all of the Company’s related party transactions, on March 2, 2020, Hindenburg Research reported that General Extract LLC was a related party entity with no credible operations run by PharmaCielo’s former COO. The report further asserted that PharmaCielo had engaged in misleading business transactions with General Extract and Xphyto Therapeutics, and questioned the delayed development of its processing center and general misinformation regarding its production facilities. Since this news, shares of PharmaCielo have declined 63% per share, currently trading at around $0.51 per share.
PharmaCielo Ltd. (PCLOF) Shareholders Have Legal Options
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