SEC Whacks Executive for Biopharmaceutical
NEWARK (CN) - The SEC charged two doctors and a third person with inside trading on confidential information about the failure of a biopharmaceutical company's prize drug.
The SEC sued Drs. Loretta M. Itri and Neil T Moskowitz, and Moskowitz's friend Matthew Cashin, in Federal Court.
"This insider trading case involves a biopharmaceutical company executive who tipped her long-time friend with material nonpublic information concerning an upcoming announcement about the company's key developmental drug," the complaint states.
"The insider trading was carried out by Itri, President of Pharmaceutical Development and Chief Medical Officer of Genta, Inc. ('Genta'), and Moskowitz, a friend who Itri has known for approximately 40 years. Through her work, Itri obtained material nonpublic information about Genta's clinical trial results for an experimental drug designed to treat advanced melanoma. During a telephone conversation just one day before the negative public announcement of the results of the trial, Itri provided Moskowitz with material nonpublic information. Minutes after his call with Itri, Moskowitz sold his Genta securities. Moskowitz then tipped Cashin and induced three other investors to sell their Genta securities before the negative public announcement. As a result of these trades made based on material nonpublic information, Moskowitz and Cashin reaped illegal gains of approximately $139,000."
The SEC seeks disgorgement, penalties and injunctions.