Wong Chi-huey, the head of Taiwan's lead science research agency, has issued a public apology for his daughter's controversial sale of OBI Pharma shares, saying it was in fact him who dumped the stock just before a cancer drug from the biotech failed a key trial.
The Academia Sinica President--and a world-renowned chemist who has been touted as a potential future Nobel Prize winner--has been under increasing pressure to explain how his daughter was able to afford 3 million OBI Pharma shares, priced at NT$31 ($0.95) per share at the time of purchase, and why she sold a number of shares so close to the announcement.
The Taipei-based biotech's lead drug--the breast cancer candidate OBI-822/82--posted disappointing results from a late-stage trial in February. The company said on Feb. 21 that the candidate did not meet the primary efficacy endpoint in a Phase II/III study, but that it showed improvement in progression-free survival and the secondary endpoint of overall survival "is trending towards statistical significance."
Last week the Taiwan prosecutor released new information alleging that Wong's daughter had indeed sold some of her stock, although Wong had initially denied this. He issued a statement yesterday saying it was in fact him who sold the shares on his daughter's behalf, and apologized for originally denying they had been sold. Wong is currently in the U.S., but is expected to return to the country next week for questioning.
In a report sent to the Legislature's Education and Culture Committee, he said his decision to sell his daughter's shares in OBI Pharma on her behalf was based on a "financial planner's advice," according to the Taiwan Focus news channel.
Wong said his daughter was living in the U.S. and gave consent for him to trade the stocks on her behalf. The sale of the stocks sparked allegations of insider trading--particularly as he is considered an expert on the development of the drug.
Kuomintang Legislator Chen Shei-saint, who heads the legislative Education and Culture Committee, said Wong's report still had not cleared up all the questions surrounding the share sale.
The committee will schedule a time for Wong to explain the matter in person when he returns from the U.S. April 14, Chen said.
In particular, Wong will have to answer the question of whether the stock sales were linked to the failed drug trials, and will also face further tax questions over the sale.
- check out the Taiwan Focus report