Former Kadmon consultant pleads guilty to insider trading ahead of Sanofi buyout

While Sanofi scooped up an FDA-approved drug in its purchase of Kadmon Holdings, a consultant to the latter company landed himself a charge for insider trading around the deal. Now, he's pled guilty.

Frank Glassner, 68, on Friday pled guilty to one count of securities fraud for trading based on his private knowledge of the deal. Glassner's firm had been advising Kadmon, and the feds say the consultant made $368,000 by trading based on knowledge of the impending buyout.

Last summer, Kadmon hired Glassner’s California-based consulting firm to provide services related to the upcoming acquisition, the feds say. The consultant traded Kadmon stock and options last August based on knowledge of the buyout, they added. By September 8, the acquisition news became public and Kadmon’s share price increased by 71%. 

“As he admitted in court, Frank Glassner misappropriated his client’s material, non-public information about an upcoming acquisition to make personal trades and line his own pockets,” said U.S attorney Damian Williams in a statement.

The feds charged Glassner in May.

Glassner is awaiting sentencing, slated for December 6, and must forfeit the money he made off the crime. The maximum sentence is 20 years in prison.

Insider trading scandals have spanned the pharma industry lately. In May, authorities charged AstraZeneca’s former global head of corporate affairs for oncology for taking advantage of his knowledge of AZ’s 2019 Enhurtu licensing deal with Daiichi Sankyo. The feds say Hugues Joublin, Ph.D., bought $20,000 worth of Daiichi stock six days after he became aware of the deal in March 2019.

And last September, the SEC said former Goldman Sachs compliance analyst Jose Luis Casero Sanchez made more than $70,000 by using private information of Jazz Pharmaceutical’s acquisition of G.W. Pharmaceuticals to buy stocks.