The U.S. SEC settled charges against Philip Markin, a fifth person charged in connection with an insider trading scheme involving the February 2021 $1.85 billion offer by Merck & Co. Inc. to acquire Pandion Therapeutics Inc.
Criminal and civil charges related to insider trading were filed Sept. 10 against Dishant Gupta based on his stock purchases of Epizyme Inc. in the months leading up to its acquisition by Ipsen SA.
Another day, another insider trading deal involving biopharma stock. One of the latest U.S. SEC cases involves a retired dentist, Stephen Forlano Sr., who traded on a tip passed on through his son from a close friend who was an analyst at an investment firm handling a strategic financing collaboration with Harmony Biosciences Holdings Inc.
The year 2024 squeaked through another IPO this week, that of Actuate Therapeutics Inc., which raised $22.4 million becoming the 15th biopharma company to debut on U.S. exchanges this year. Out of 17 companies total, including one listing on the Hong Kong Stock Exchange and another on the SIX Swiss Exchange, the industry has raised a total of $4.8 billion through IPOs.
New U.S. SEC rules designed to reel back the special purpose acquisition (SPAC) market went into effect on July 1, yet only a few weeks later two such companies completed IPOs and are now targeting mergers with health care and life sciences firms, including biopharma and medical technology.
In a 5-4 decision June 27, the U.S. Supreme Court scuttled a Purdue Pharma LP’s bankruptcy plan that would have discharged any claims against the Sackler family, which owned and controlled the company that made billions of dollars from its sales of Oxycontin (oxycodone).
Suzhou, China-headquartered Ascentage Pharma Group Corp. Ltd. has filed plans for a confidential IPO to the U.S. SEC for a potential dual listing on both the U.S. and Hong Kong stock exchanges. News of the U.S. IPO came just a few days after Ascentage drew a $75 million equity investment from Osaka, Japan-headquartered Takeda Pharmaceutical Co. Ltd. with the issuance of about 24.3 million shares at a purchase price of HK$24.09 (US$3.08) per share.
The recent conviction of Ontrak Inc. CEO Terren Peizer for insider trading was conspicuous on two counts, including that it was the first time such a conviction had been obtained solely for trading conducted under a government-approved insider trading policy. More worrisome for industry, generally, is the case is another example of federal prosecutors’ ever-growing use of data and analytics to root out violations of SEC law. This is a trend that seems destined to grow with advances in artificial intelligence.
A woman who allegedly made nearly $300,000 last year on insider trading based on undisclosed information about a pending biopharma acquisition will have to disgorge her profits, along with interest, to the U.S. Treasury, but she will face no other penalties.
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