Merck’s $1.9 billion acquisition of Pandion Therapeutics was a major score for those with stock in the Massachusetts biotech. In one day, the price of Pandion shares surged from $25.63 to $59.81.
But for some of the shareholders, the gains were ill-gotten, according to the Securities and Exchange Commission (SEC). Last year, the SEC charged three with insider trading that made them a combined $2.5 million. And now the SEC has settled with another who allegedly used insider information to purchase Pandion shares in advance of the acquisition.
Nirdosh Jagota, 61, who was a vice president of global regulatory affairs at Merck when the Pandion buyout was announced, has agreed to a deal with the SEC. Jagota will return the $39,660 he made from the two stock purchases he made on Feb. 9 and Feb. 17, ahead of the Feb. 25 merger.
Jagota, who left Merck in August of 2021 and has since held positions at three other biopharma companies, also will pay a civil penalty of $39,660 and prejudgment interest of $3,605.
He also has agreed to not serve as an officer or director of a public company for three years. Jagota has been Amgen’s VP of quality for the last 13 months. An Amgen spokesperson said on Thursday that he is no longer with the company.
Jagota, who did not admit nor deny the SEC’s findings, oversaw a team that performed (PDF) due diligence for Merck relating to the acquisition, the SEC said.
Last year, the SEC charged Seth Markin, 32, with insider trading that netted him $800,000 on the Merck-Pandion acquisition. Markin, a former FBI trainee, found out about the deal, the SEC claims, by rifling through a binder of confidential information he found at the home of his romantic partner, a lawyer who represented Merck.
Markin passed the information onto his friend Brandon Wong, 39, who made $1.2 million off his stock purchases, the SEC alleges. Wong’s brother, Brian, also was tipped off about the acquisition and made $400,000 from the stock he bought in Pandion, the SEC says.
In a separate case, which was settled in January of this year, Donna Matuizek also was charged with insider trading based on her knowledge of the Merck-Pandion acquisition. Matuizek, who allegedly heard about the deal when serving as the vice president of quality at Just Biotherapeutics, made $27,800 on her stock purchase, the SEC said.
Seattle-based Just Bio was a key supplier of Pandion, the SEC said. Like Jagota, Matuizek returned her gains and paid a matching $27,800 as a civil penalty, without admitting or denying the findings. She left Just Bio in July of 2022.
Three weeks ago, the SEC charged another former pharma VP with insider trading that netted him and four others $2.3 million. Joseph Dupont, who headed up go-to market transformation and business operations for Alexion, allegedly took advantage of prior knowledge of Alexion’s 2020 acquisition of Portola Pharmaceuticals.
Editor's note: Since the original version of this story published, Fierce Pharma learned about the January settlement between Donna Matuizek and the SEC. This story has been updated with that information.