SEC Filings

Ardelyx Faces A New Securities Class Action Reaching Back To January 2025

A September suit and an October derivative case target the drugmaker, which says it cannot estimate any loss.

Ardelyx, the maker of the IBS-C drug IBSRELA and the dialysis drug XPHOZAH, now faces a putative securities class action filed September 17 on behalf of anyone who bought its stock between January 13, 2025 and August 6, 2026, according to its quarterly report filed Tuesday. A shareholder derivative suit built on the same allegations followed October 13.

Two suits, one set of allegations

The class action, Broadwater v. Ardelyx, names the company, CEO Michael Raab, Justin Renz, Susan Hohenleitner and Eric Foster. It alleges violations of Sections 10(b) and 20(a) of the Exchange Act; damages are unspecified.

The derivative case, Marti v. Raab, is brought on the company's behalf against current and former directors and managers. It alleges breach of fiduciary duty, unjust enrichment, waste of corporate assets, gross mismanagement and abuse of control, and seeks damages, restitution and governance reforms.

The class period ends on August 6, 2026, the date of the prior quarterly report, which did not list a pending securities suit. Shareholders have until November 16 to seek appointment as lead plaintiff in Broadwater.

Insurance may fall short

Ardelyx says it will fight both cases and cannot estimate any loss. Its risk factors add that D&O insurance could prove inadequate, and that the company bears amounts within the retention.

The company has been here before. An earlier class action over its XPHOZAH reimbursement decision, Yarborough, covered purchasers from February 22, 2024 to July 1, 2024. The court dismissed it with prejudice on December 24, 2025, and plaintiffs' appeal was voluntarily dismissed March 26, 2026. The related derivative case was dismissed April 9, 2026.

A business growing while it litigates

Ardelyx sells two medicines from the same active ingredient, tenapanor, through its own specialty sales force. Third-quarter product sales rose 19% to $125.5 million, with IBSRELA up 23% to $96.3 million and XPHOZAH up 7% to $29.2 million, the company reported. Net loss was $0.7 million, against $1.0 million a year earlier.

The accumulated deficit stood at $1.0 billion as of September 30, and the company had $285.3 million in cash and investments. Its market value was $782 million in Tuesday trading.

The company's conference call was scheduled for 4:30 p.m. Eastern Tuesday, and the November 16 lead-plaintiff deadline will decide who steers Broadwater.