BioXcel Hid an FDA Investigation Into Its Alzheimer’s Drug Trial Now Investors Have a $9.75M Settlement

BioXcel Therapeutics Inc. and three of its executives agreed to pay $9,750,000 to settle a securities class action lawsuit alleging they concealed serious compliance problems in their Alzheimer’s drug clinical trial from investors. Investors who purchased BTAI stock between March 9, 2023, and June 28, 2023, may qualify for a cash payment. The deadline to file a claim is June 30, 2026.

Quick Facts

Field	Detail
Settlement Amount	$9,750,000
Claim Deadline	June 30, 2026
Who Qualifies	BTAI stock purchasers between March 9, 2023 – June 28, 2023
Estimated Payout Per Share	~$1.10 net (after fees and expenses)
Proof Required	Yes — brokerage statements or trade confirmations
Settlement Status	Preliminarily approved — Fairness Hearing Sept. 2, 2026
Administrator	Strategic Claims Services
Official Website	BioXcelSecuritiesSettlement.com

Current Status & What Happens Next

• The court has granted preliminary approval. Judge Sarala V. Nagala of the U.S. District Court for the District of Connecticut will hold the final fairness hearing on September 2, 2026 at 10:30 a.m.
• The deadline to file a claim is June 30, 2026. Investors who want to exclude themselves from the settlement or file a written objection have until August 5, 2026.
• Payments go out only after the court grants final approval, any appeals are resolved, and Strategic Claims Services processes all valid claim forms.

BioXcel Said Its Alzheimer’s Trial Was on Track. The FDA Already Had Concerns.

BioXcel Therapeutics positioned itself as an AI-driven drugmaker on the cutting edge of Alzheimer’s treatment. Its flagship candidate, BXCL501 (dexmedetomidine), was in a pivotal Phase 3 clinical trial called TRANQUILITY II, aimed at treating agitation in Alzheimer’s patients. Throughout early 2023, the company told investors the trial was progressing and the future looked bright.

What investors did not know — and what the lawsuit alleged BioXcel was actively concealing — was that the FDA had already launched an investigation into how that trial was being run. BioXcel disclosed in June 2023 that its principal investigator for the TRANQUILITY II trial had failed to adhere to the informed consent form approved by the Institutional Review Board for some trial subjects, failed to maintain adequate case histories for certain patients reviewed by the FDA, and may have fabricated email correspondence to make it appear that a serious adverse event had been timely reported. That fabricated correspondence, according to BioXcel’s own disclosure, had been handed to the FDA during an on-site inspection in December 2022 — months before the class period even began.

When BioXcel published this disclosure before the market opened on June 29, 2023, the stock fell $11.28 per share — a single-day drop of 63.8% — closing at $6.39 on unusually heavy trading volume. Investors who had bought shares during the spring of 2023, while BioXcel was publicly projecting confidence about the trial, absorbed the full weight of that collapse. The lawsuit — formally titled Hills et al. v. BioXcel Therapeutics, Inc., et al., Case No. 3:23-cv-00915 — named BioXcel, its CEO Vimal Mehta, CFO Richard Steinhart, and Chief Medical Officer Robert Risinger as defendants. All defendants deny wrongdoing and settled to avoid the costs and risks of continued litigation.

You Had a Very Short Window to Buy BTAI. Check Your Dates Before Assuming You Don’t Qualify.

The class period here is unusually narrow — just under four months, from March 9, 2023, through June 28, 2023. That means many long-term BTAI holders who bought earlier will not qualify unless they made additional purchases during that specific window.

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• You may qualify if you purchased or otherwise acquired BioXcel Therapeutics Inc. common stock (CUSIP: 09075P204) between March 9, 2023, and June 28, 2023, inclusive.
• You may qualify if you still held those shares at the close of trading on June 28, 2023 — this is the scenario that generates the maximum recognized loss under the plan of allocation.
• You may qualify if you are an individual investor, a pension fund, an institutional investor, a trust, an estate, or any other legal entity that acquired BTAI shares during the class period.
• You may qualify if a legal representative — an executor, trustee, guardian, or conservator — files on your behalf with proof of their authority to do so.
• You will not qualify if you purchased BTAI shares only before March 9, 2023, or only after June 28, 2023, or if you are one of the named defendants or fall under the standard exclusions in the official settlement notice.

If you are unsure whether a trade qualifies, pull your brokerage statements and check the exact trade date. A single qualifying purchase during that window is enough to file a claim.

Held Shares When the Stock Crashed 64%? Your Recognized Loss Is $11.28 Per Share.

The total settlement fund is $9,750,000. Class Representatives estimate the average cash recovery per share will be approximately $1.52 before deductions for court-approved fees and expenses. After estimated deductions, the average net recovery is approximately $1.10 per share.

The plan of allocation ties your recognized loss directly to whether you still held shares when the June 29, 2023 disclosure hit:

• Shares purchased during the class period and held through June 28, 2023: Recognized loss = $11.28 per share — the full single-day drop investors absorbed when the disclosure became public.
• Shares purchased during the class period and sold before June 29, 2023: Recognized loss = $0. Investors who exited before the disclosure will not recover from this fund.

All payments distribute pro rata from the net settlement fund. Class members whose calculated payment would be less than $10 will not receive a distribution.

From the $9,750,000 fund, the court may approve up to $2,437,500 in attorneys’ fees (25%), up to $225,000 in litigation expenses, and up to $30,000 in combined service awards to the two class representatives. The remaining balance distributes to eligible claimants. Final individual payout amounts are TBD until all claims are submitted and processed.

How to File Your Claim — The Deadline Is June 30, 2026

Step 1 — Go to the official settlement website: BioXcelSecuritiesSettlement.com

Step 2 — Click “File a Claim Online” to submit electronically, or download and print the PDF claim form to mail.

Step 3 — Enter your personal information, including your full Social Security number or taxpayer identification number.

Step 4 — Provide your complete BTAI transaction history: shares held as of the close of trading on March 8, 2023; all purchase and sale dates, share quantities, and prices from March 9 through June 28, 2023; and shares held as of the close of trading on June 28, 2023.

Step 5 — Attach supporting documentation. Acceptable proof includes broker confirmation slips, brokerage account statements, or any official transaction records showing trade dates, quantities, and prices.

Step 6 — Submit your claim and save your confirmation for your records.

Mail claims to: Hills et al. v. BioXcel Therapeutics, Inc., et al., c/o Strategic Claims Services, 600 N. Jackson St., Suite 205, P.O. Box 230, Media, PA 19063

Phone: (866) 274-4004 | Email: [email protected]

Estimated time to complete: 10–20 minutes, longer if you need to locate older brokerage records.

Key Dates

Milestone	Date
Stipulation of Settlement Filed	February 27, 2026
Claims Period Opens	Already open
Claim Filing Deadline	June 30, 2026
Opt-Out Deadline	August 5, 2026
Objection Deadline	August 5, 2026
Fairness Hearing	September 2, 2026 at 10:30 a.m.
Expected Payment Date	TBD — after final approval and appeals

Frequently Asked Questions

I owned BTAI for years before 2023. Does that mean I qualify?

 Not automatically. Only purchases made between March 9, 2023, and June 28, 2023, count toward recognized loss. Check your brokerage records for any transactions during that specific window. A purchase you made before March 9, 2023, does not qualify — but if you bought additional shares during the class period, those purchases may.

The class period is only four months. Is the ~$1.10 per share estimate reliable?

 It is the Class Representatives’ own estimate, based on all eligible shares participating. If fewer shares file claims, payouts per share will be higher. If more shares file, payouts will be lower. The estimate gives you a reasonable ballpark, but your actual check depends on total valid claim volume.

What exactly did BioXcel’s principal investigator do wrong?

 According to BioXcel’s own June 2023 disclosure, the investigator failed to follow the FDA-approved informed consent process for some trial participants, failed to keep adequate case histories, and may have fabricated email correspondence to falsely show that a serious adverse event had been reported on time. That fabricated correspondence was then provided to FDA inspectors. The lawsuit alleged BioXcel knew about these problems months before telling investors.

Do I need a lawyer to file?

 No. The claim form is straightforward and available online at BioXcelSecuritiesSettlement.com. You only need a lawyer if you plan to object to the settlement terms or pursue a separate individual action against BioXcel.

Is this settlement legitimate? 

Yes. The case — Hills et al. v. BioXcel Therapeutics, Inc., et al., Case No. 3:23-cv-00915 — is pending in the U.S. District Court for the District of Connecticut. Strategic Claims Services, a nationally recognized administrator, manages claims under the supervision of Lead Counsel at Levi & Korsinsky, LLP and Grant & Eisenhofer P.A. Only use the official site at BioXcelSecuritiesSettlement.com.

When will I receive my payment?

 No specific payment date is confirmed. Payments go out after the September 2, 2026 fairness hearing results in final approval, any appeals are resolved, and Strategic Claims Services finishes processing all valid claims. Expect at minimum several months after the hearing.

What if I miss the June 30 filing deadline? 

You will remain a member of the settlement class — meaning you give up your right to sue BioXcel separately over these same claims — but you will receive no payment. The deadline is firm and missing it permanently bars you from recovering anything from this fund.

Will the settlement payment count as taxable income? 

Possibly. How the IRS treats securities settlement payments depends on your individual tax situation and the nature of your original investment loss. Consult a qualified tax professional in the year you receive your payment. Strategic Claims Services does not provide tax advice.

Sources & References

1. Official Settlement Website (Strategic Claims Services): BioXcelSecuritiesSettlement.com
2. Official Long-Form Notice and Claim Form (PDF): bioxcelsecuritiessettlement.com — Notice
3. PACER Docket — Case No. 3:23-cv-00915, D. Conn.: pacer.uscourts.gov
4. BioXcel Therapeutics SEC Filings (EDGAR): sec.gov — BioXcel EDGAR filings

Last Updated: March 24, 2026

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Legal claims and outcomes depend on specific facts and applicable law. For advice regarding a particular situation, consult a qualified attorney.