(RTTNews) - Quantum BioPharma Ltd. (QNTM), a Toronto-based biotechnology company, has filed a USD $700 million lawsuit alleging stock market manipulation that it says nearly derailed its promising Lucid-MS research targeting multiple sclerosis candidates. The case is now the subject of a three-part investigative series by CTV's flagship program W5, with Part 2 scheduled to air today.
Multiple sclerosis (MS) affects nearly 90,000 Canadians, progressively damaging nerves and limiting mobility.
In preclinical studies, Lucid-MS showed striking results: mice with MS-like nerve damage regained mobility after treatment, sparking optimism among patients and investors.
Despite favorable trial progress and regulatory clearance to advance Lucid-MS, Quantum's stock price fell from $7.39 to under $2.76 between 2020 and 2021.
According to CTV News, investors like Atul Dhadwal, who committed $300,000 to the company, saw their holdings lose 98% of their value. Quantum alleged this collapse was not due to science but to "spoofing" tactics on Canadian exchanges, a form of market manipulation where traders place and cancel large orders to distort prices. The company claims these practices made it nearly impossible to raise capital, threatening the continuation of Lucid-MS trials.
The lawsuit, filed in late 2025, alleges that major Canadian institutions have enabled or failed to prevent manipulation. Quantum argues that at least 16 million illegal and fictitious orders came from Canadian bank platforms, with CIBC and RBC named as defendants.
Quantum BioPharma Co-Executive Chair Anthony Durkacz added, "The basis of our USD $700 million lawsuit against CIBC and RBC is that we are alleging Canadian exchange trading data clearly show stock spoofing on a massive scale intended to manipulate Quantum BioPharma's stock price. It is the banks and the brokers that have the responsibility to act as gatekeepers, and to ensure that their clients and their traders are not breaching trading rules and regulations or engaging in illegal activity such as stock spoofing." For patients, the stakes remain high. Board member Alexander Bar, who lives with MS, explained: "If they can't raise money, they can't do the trials to prove that the research works. And for people like me, that drug will never become accessible."
Quantum continues to pursue clinical advancement of Lucid-MS, despite financial headwinds. The company is seeking damages to restore investor confidence and secure funding for trials. Broader regulatory exchanges may follow, as the case highlights vulnerabilities in biotech financing.
Quantum cautioned that the outcome of the lawsuit and ongoing litigation funding will be critical to sustaining Lucid-MS development.
QNTM closed Wednesday's trade at $11.41, up 41.92%, and rose further in the overnight trading to $12.98, up 13.76%, as of 2:41:50 AM EST.