As reported in the WSJ Health blog yesterday, the SEC has charged a French physician, who served on the clinical trial committee for a Human Genome Sciences' (HGS) hepatitis C drug, with one count of conspiracy to commit securities fraud and one count of securities fraud.
The good doctor is alleged to have tipped off hedge fund managers about adverse effects of HGS albuferon in ongoing hepatitis C trials in 2007-08. Six fund mangers subsequnetly dumped their position in HGS stock prior to any public announcment of problems with the drug for this indication. This resulted in stopping losses of nearly $30 M after they sold their 6 million plus shares.
The good doctor, Yves M. Benhamou, might give Sam Waksal a call to ask about prison food, appropriate attire and etiquette. Besides, with Yves expertise in hepatitis C - Sam's new Kadmon group may be in need of consultant help with their hep C trials.
Posted by Bruce Lehr November 3rd 2010.