In the face of short attacks, it is not uncommon these days for companies to cry foul and defend themselves against what they call false and misleading statements. But are these short sellers involved in something more nefarious? The Department of Justice is reportedly trying to find out through a sweeping criminal investigation.
Federal investigators are scrutinizing an unknown number of hedge funds and research firms — alongside their trading of at least several dozen shorts — to see if any kind of deception or manipulation was involved, Reuters and Bloomberg reported.
The stocks under the spotlight include specialty pharma Mallinckrodt, Luckin Coffee, Banc of California and GSX Techedu, all well-known short targets. Andrew Left’s Citron Research (which actually decided earlier this year it’s getting out of short selling) is one of the dozen or so firms that are part of the inquiry, according to the insiders cited by the two outlets.
So what exactly are the feds looking for?
The wrongdoings could range from misleading the public about who funded supposedly independent research (for example, if a hedge fund pays a researcher to write a scathing report on a company it wanted to short) to violating confidentiality agreements with authors to engineering stock plunges to cause panic.
While the practice of betting that a company’s stock will plunge — and profiting through a convoluted scheme of trading on borrowed shares — is long-established, it received renewed attention after retail investors banded together earlier this year to ‘squeeze’ those bets by big firms against popular short targets, such as GameStop, AMC and BlackBerry, leading share prices to soar.
The SEC and DOJ have previously gone after hedge funds for alleged ‘short and distort’ campaigns.
In a recent case, the SEC charged Rev. Emmanuel Lemelson — a Greek Orthodox priest who managed a tiny hedge fund — with spreading false claims on social media to promote a short attack on Ligand Pharmaceuticals. Last month, a jury found him liable for making those untrue statements but not for intentionally defrauding Ligand investors.
Sensor-based technology for clinical trial data collection represents the latest medical paradigm shift. There are more than 700 clinical studies involving wearable devices currently underway in the United States. A study from Intel IT projects their inclusion in clinical trials will surge to 70% by 2025.
Apps, biosensors and patient-centered technologies increase visibility of comprehensive patient data. Pharma leaders anticipate the benefits of wearables to include better data (58%), faster results (33%) and lower trial costs (10%).
When Bristol Myers Squibb celebrated the approval of ozanimod — branded Zeposia — in ulcerative colitis earlier this year, the company touted the first gastrointestinal indication for an S1P receptor modulator.
Now Pfizer wants to give the pharma rival a run for its money.
Pfizer is dropping $6.7 billion to acquire Arena Pharmaceuticals, whose lead drug, etrasimod, targets the sphingosine 1-phosphate receptor.
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Rumors have swirled around a potential buyout of Switzerland’s Vifor Pharma by Australia’s CSL since the start of December, and now the gossip reportedly has some truth to it.
Vifor confirmed to Reuters early Monday that it is in discussions to be acquired by CSL for more than $8.5 billion, sending its shares up more than 15% in overseas trading. The deal is expected to be finalized Tuesday, according to Australian media, with one large investor reportedly willing to pay more than $173 per share — about $60 more than Vifor’s price before the rumors began circulating on Dec. 2.
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Gene therapy biotech Intellia Therapeutics has dosed its first patient with genome editing candidate NTLA-2002, its drug candidate for hereditary angioedema, a rare genetic condition that causes swelling under the skin.
The drug candidate has been under development as a single-dose gene therapy to prevent HAE attacks by inactivating the target gene kallikrein B1 (KLKB1). That would, Intellia hopes, reduce plasma kallikrein activity and thus prevent HAE attacks.
AbbVie’s Migraine Relief-Tok on TikTok
Relaxation apps have nothing on AbbVie migraine med Ubrelvy’s TikTok. Ocean waves and birds chirping offer respite and a quiet scrolling break on the more typically frenetic social media app.
AbbVie calls it Migraine Relief-Tok and in a series of ads feature different calming sounds of nature with the advice: ‘Take a Break. Breathe in, Breathe out.’
The unexpected quiet in what can be an overstimulating experience of music, dancing, pop culture and politics is intentional. AbbVie knows that like many people, the 40 million people who suffer from migraine, are also on social media and TikTok.
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Roberto Bellini, Bellus Health CEO
Do investors want the good news, or the bad news first? Bellus went with the good news, sharing that its chronic cough contender hit the primary endpoint in a Phase IIb trial, lining it up for a Phase III study in the second half of next year where it could pose stiff competition for Merck.
Amidst all the commotion, the Canadian biotech also revealed that the same candidate flunked a proof-of-concept trial in atopic dermatitis, and the company will now steer the program away from pruritic conditions.
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Soon after San Francisco-based Genentech won an EUA for tocilizumab as a treatment for hospitalized Covid patients last summer, the company announced a shortage of the drug while pointing to the emergence of the Delta variant and the slowing of vaccination rates across the US.
‘This new wave of the pandemic has led to Genentech experiencing an unprecedented demand for Actemra IV– well-over 400% of pre-COVID levels over the last two weeks alone and it continues to increase,’ the company said in August.
Merck’s potential Covid-19 treatment molnupiravir will not be used in France, French regulators said Friday.
The French National Authority of Health cited the potential impact of the Omicron variant, the fact that Regeneron’s mAb cocktail is more effective, and the pill’s own lack of efficacy as reasons for denying early access of the drug to patients experiencing mild to moderate cases of Covid-19. France has already pre-ordered hundreds of thousands of the pills, with the goal of treating 50,000 patients.
The Senate Finance Committee on Saturday released the latest text of President Joe Biden’s $2 trillion spending package, paid for at least in part with new negotiating power for Medicare and inflation rebates drugmakers will have to pay if their drug prices rise too quickly each year.
But now, generic drugs at risk of shortage and biosimilars have been cut out of the rebates, as their industry lobbying groups had sought. They’d said the inclusion of such rebates and negotiations could increase the likelihood of drug shortages and create barriers to competition.
https://endpts.com/biotech-short-seller-lands-on-feds-watch-list-amid-sweeping-probe-report/
