Aardvark Therapeutics Faces Investor Scrutiny After 56% Stock Plunge on Clinical Pause

Hagens Berman law firm opens investigation into whether company misled investors about drug candidate's safety and efficacy

Apr. 10, 2026 at 8:18pm by

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A photorealistic studio still life featuring a single glass beaker filled with a clear liquid, illuminated by dramatic lighting to symbolize the abstract concepts of pharmaceutical development, investor scrutiny, and corporate transparency.A pharmaceutical company's sudden clinical setback raises questions about transparency and investor trust.San Francisco Today

Shares of Aardvark Therapeutics (NASDAQ: AARD) plummeted 56% on March 2, 2026, after the company announced it was pausing a Phase 3 trial of its lead drug candidate ARD-101 due to serious safety concerns. This sharp market reaction has prompted national shareholder rights firm Hagens Berman to open an investigation into whether Aardvark may have misled investors about the drug's development, safety, and communications with the FDA.

Why it matters

The pause of the HERO trial for ARD-101, which was being evaluated as a treatment for hyperphagia in Prader-Willi Syndrome patients, raises questions about Aardvark's previous assurances to investors regarding the drug's safety profile and the company's alignment with the FDA. The severe stock drop has also led to analyst downgrades, further eroding investor confidence.

The details

Aardvark had previously emphasized that ARD-101 was a "first-in-class" drug and that it had aligned with the FDA to expand the trial to younger patient populations. However, the company abruptly announced on March 2 that it was pausing the HERO trial due to "reversible cardiac observations," a serious safety risk. This unexpected development led to a 56% plunge in Aardvark's stock price.

  • On March 2, 2026, Aardvark Therapeutics announced it was pausing the Phase 3 HERO trial for ARD-101.
  • Aardvark had previously stated it intended to dose patients as young as 4 years old in the HERO trial.

The players

Aardvark Therapeutics

A biopharmaceutical company developing treatments for rare and orphan diseases, including Prader-Willi Syndrome.

Reed Kathrein

The Hagens Berman partner leading the firm's investigation into Aardvark Therapeutics.

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What they’re saying

“We're focused on whether Aardvark may have misled investors about ARD-101's development, its safety and/or efficacy, and the company's communications with the FDA.”

— Reed Kathrein, Hagens Berman partner

What’s next

Hagens Berman is encouraging Aardvark investors who suffered substantial losses to submit their information to the firm, as well as any persons with knowledge that could assist the investigation.

The takeaway

This case highlights the importance of biotechnology companies being transparent with investors about the development, safety, and regulatory status of their drug candidates, especially when dealing with serious medical conditions like Prader-Willi Syndrome.