Osiris Therapeutics Inc. (NASDAQ: OSIR) is under pressure. It seems if there was a way the company could dodge revealing that it was under criminal investigation by the U.S. Attorney’s office it would have done it. But management has determined that sweeping such matters under the carpet can only multiply the problems and the company chose to go public over its criminal investigation.
Investors don’t like companies being investigated for criminal reasons and the recent massive pullback in the stock of Osiris doesn’t come as a major surprise except for the surprising losses it might cause some investors. The question that forward looking investors should be asking now is whether Osiris will be able to weather the legal storm it has found itself in.
What about the criminal investigation?
According to Therapeutics, Inc. (NASDAQ: OSIR), it recently received a notification from the U.S. Attorney’s office that it was being investigated and the investigation revolves around a criminal subject. It seems the company cannot accurately say what the criminal investigation is exactly about, but it believes it stems from matters that SEC is also investigating. The SEC is apparently looking into the company’s accounting practices for possible violations. It seems the U.S. Attorney’s office picked up something of interest to it from the SEC probe of Osiris.
What happens next for Osiris Therapeutics Inc. (NASDAQ: OSIR)?
Criminal investigation does not necessary mean that the company is culpable for the issues being probed. As such, investigations can result in prosecution, penalties or both or the company can be vindicated. However, the mention of investigations alone creates great uncertainty around the company as investors are unsure what might befall them.
What can investors do about?
Some investors can already be seen heading for the exit. A certain law firm is also trying to help affected investors. Law Offices of Howard G. Smith recently announced that it was investing Therapeutics, Inc. (NASDAQ:OSIR) as well as certain of its officer for potential securities violation that may have resulted in losses to investors.
Because of issue about criminal investigation of Therapeutics, Inc. (NASDAQ: OSIR) is likely to be a fast-changing story, investors can only try to keep up with the updates around the matter.