Every respectable pharma-watcher knows about the rash of deals, megasized and otherwise, that spread through the industry over the past few years. The patent cliff, the growing importance of emerging markets, the R&D malaise afflicting some Big Pharmas--all have conspired to create an epidemic of dealmaking.
Apparently, that epidemic comes with some complications. Insider trading, for one.
Yesterday, U.S. securities regulators charged 8 men with insider trading, saying they profited on the secret skinny that Sanofi ($SNY) was on the verge of buying U.S.-based consumer health company Chattem. It's the third insider trading charge related to a pharma deal this month. Just last week, the Securities and Exchange Commission fined an ex-manager at Array BioPharma for insider trading around a licensing deal. And on Aug. 2, a Bristol-Myers Squibb ($BMY) executive was charged in connection with his own trades around the company's M&A.
Here's more on the latest case: According to the Securities and Exchange Commission, a Georgia accountant came by confidential information about the Sanofi deal from a client on Chattem's board. Melvin passed the news off to friends, who told other friends. The "ring" of men then profited at least $500,000 on related trades, the SEC says.
More charges could be coming. The SEC has been digging around more pharma deals, including Merck's ($MRK) 2009 buyout of Schering-Plough, Pfizer's ($PFE) merger with Wyeth the same year, and Eli Lilly's ($LLY) ImClone buyout in 2008. An earlier probe of AstraZeneca's ($AZN) MedImmune deal yielded charges in 2010.
- see the Reuters news
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