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Notice of Filing Securities Class Action Against AtheroGenics, Inc., Michael Henos, Russell Medford, Mark Colonnese and Robert Scott.

ATLANTA -- Atlanta based Chitwood & Harley LLP announces that it has filed a securities fraud class action complaint in the United States District Court for the Northern District of Georgia against AtheroGenics, Inc. ("AtheroGenics" or the "Company"), Michael Henos, Russell Medford, Mark Colonnese and Robert Scott on behalf of persons who purchased AtheroGenics common stock (NYSE: AGIX-News) on September 27, 2004 in after hours trading, following the Company's announcement of its interim study results, through and including December 31, 2004 (the "Class Period"). The case number is 1:05- CV-0070. A copy of the complaint is available from the court and will be posted on Chitwood & Harley's website, www.classlaw.com for the next two months.

If you purchased or otherwise acquired AGIX securities after the Company issued its September 27, 2004 interim study results through and including December 31, 2004, and have been damaged thereby, you may request that the Court appoint you as lead plaintiff no later than March 7, 2005. Any member of the purported class may move the Court to serve as lead plaintiff in this action through counsel of his or her choice, or may remain an absent class member. There are certain legal requirements to serve as lead plaintiff, which Chitwood & Harley would be happy to discuss with you. You may contact the firm through its website, www.classlaw.com, or by contacting Lauren S. Antonino, Esq. at lsa@classlaw.com or Nichole B. Adams, Esq. at nba@classlaw.com or at the address or phone numbers provided below. You are also welcome to submit questions or transaction information to Chitwood & Harley online at www.classlaw.com.

The Complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The class period begins on September 27, 2004 after Defendants announced the interim results of the CART 2 study of the AGI-1067 drug. The Complaint alleges, among other things, that the Company's statements regarding the CART 2 study of AGI-1067 in the September 27, 2004 press release and conference call and in the September 28, 2004 interview that defendant Medford gave were false and misleading because the interim results were incomplete, misleading and resulted from manipulation of the study. Plaintiffs claim that defendants were motivated to manipulate the study to produce results that would induce a major pharmaceutical company to partner with it to complete the development and commercialization of AGI-1067. In response to defendants' hyping of the misleading interim results, Plaintiff charges, Atherogenics' stock price skyrocketed, rising 71% in unusually heavy after hours trading on September 27, 2004.

On November 22, 2004, defendants were forced to admit that the percentage of regression of plaque in patients using AGI-1067 was only slightly more than half as much as had been reported in the interim results defendants had announced two months earlier. In addition, defendants revealed that the Phase IIb results, though based on twice the patient population, showed that the relative difference between treatment with AGI-1067 and Standard of Care regime was not statistically significant. The market was stunned, and the stock price dropped precipitously. Then, on January 3, 2005, the Company announced that it had decided to increase the number of patients in the Phase III study for the drug from 4000 to 6000 patients, that the study would be longer in duration, and that the Company needed to raise more cash to fund the study. On this news, the Company's stock fell again, this time 20% to close at $18.72 on unusually heaving trading. On January 5, 2005, the Company disclosed in a SEC filing that the SEC and NASD had commenced informal inquiries into the Company's September 27, 2004 announcement of interim results of the study.
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Publication:Business Wire
Date:Jan 7, 2005
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