Clinical trial nabs SEC attention
A Securities and Exchange Commission investigation has added a new angle to the clinical trial world: the potential for insider trading. The government agency announced Monday that it has accused two California doctors of illegally using non-public information to make money.
The SEC says the two doctors had agreed to provide services as part of a clinical trial for GTx, which was testing its prostate cancer drug Capesaris. The doctors were paid for their participation in the study, and the SEC notes the contracts “contained strict confidentiality provisions” that kept the physicians from “using non-public information about the trials for any purpose other than rendering services.”
The SEC alleges that the doctors sold GTx stock after the drugmaker said the FDA idled the trials over safety concerns, and before GTx made this news public. The SEC says the doctors saved close to a combined $46,000 because they were able to unload stock before the news depressed share prices.