01 May QuestionDrug Company X reports a new pill that is guar
Question
Drug Company X reports a new pill that is guaranteed to lose weight without any side effects. The information was advertised with a public offering of stock by the company. Later, additional test showed the pill causes users to lose their hair. The company president is pleased with the sale of the drug but realizes the company cannot advertise the drug has no side effects. However, the president does not believe any misrepresentation was made because the company was not aware of tne side effects when the previous statements were made. The company will not do anything. Is tnis a correct decision under Rule 10B-5?
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