SEC Costs Ipsen Employee for Insider Buying and selling Tied to $247M Epizyme Acquisition

Most cancers is a giant a part of Ipsen’s development technique, evident in a sequence of enterprise offers struck by the corporate lately to develop its oncology portfolio and drug pipeline. An Ipsen employee who allegedly profited from inventory transactions primarily based on private data of his employer’s $247 million buyout of a most cancers drug developer has now been charged with insider buying and selling.

The Securities and Alternate Fee on Tuesday filed a grievance in opposition to Ipsen worker Dishant Gupta. Gupta has agreed to plead responsible, in accordance with a separate court docket submitting. The financial penalty has but to be determined. The U.S. Legal professional’s Workplace for the District of Massachusetts has additionally filed prison prices in opposition to Gupta for his alleged conduct.

Paris-based Ipsen maintains U.S. operations in Cambridge, Massachusetts. In early 2022, Ipsen began speaking with Epizyme about buying that Cambridge-based firm’s drug, Tazverik, in accordance with the SEC grievance. Tazverik received FDA approval in 2020 for the therapy of follicular lymphoma. Negotiations between Ipsen and Epizyme progressed from a possible acquisition of the most cancers drug to a buyout of your complete biotech firm. The Epizyme acquisition was introduced on June 27, 2022.

Gupta lives in New Jersey and infrequently labored from residence, the SEC stated within the grievance. He’s director of knowledge technique and operations, a task that entails the advertising and strategic pricing of merchandise. By means of this place, Gupta allegedly realized concerning the market potential and advertising technique for a drug that seemed to be Tazverik.

Within the months main as much as the acquisition announcement, the SEC stated Gupta ran quite a few web searches utilizing the phrases “Epizyme buyout” and “Epizyme takeover.” 9 days earlier than the deal was introduced, Gupta searched the phrase “Ipsen acquired Epizyme,” in accordance with the grievance. Whereas the businesses negotiated the transaction, Gupta allegedly collected Epizyme shares. From April to June of 2022, the grievance notes that Gupta bought Epizyme inventory on 27 totally different days.

“Whereas Gupta constructed a place in Epizyme all through this era, he was most aggressive within the weeks main as much as the announcement,” the SEC stated within the grievance. “Particularly, between June 16, 2022, and June 24, 2022, Gupta bought roughly 200,000 shares, spending practically $160,000.”

The acquisition announcement got here within the early morning hours of June 27, timed to occur forward of the inventory market open in Europe. By 9:30 am Jap time, Gupta had bought all of his Epizyme shares for a revenue of $260,078.27, the SEC stated.

The SEC grievance, filed within the U.S. District Courtroom for the District of Massachusetts, is case quantity 24-cv-12316. In line with a court docket submitting, Gupta has entered a written settlement to plead responsible to at least one rely of securities fraud. He should quit the cash he gained illegally and in addition pay a civil high quality. Per phrases of the plea, Gupta is barred from serving as am government or director of any publicly traded firm. The phrases of this settlement are nonetheless topic to court docket approval.

Oncology merchandise are the most important driver of income for Ipsen, accounting for greater than €2.3 billion of the corporate’s €3.1 billion in 2023 gross sales. Apart from the deal that introduced the corporate Tazverik, Ipsen had acquired the permitted Merrimack Prescription drugs pancreatic most cancers drug, Onivyde. the corporate has additionally struck offers for applications nonetheless in growth. In July, Ipsen reached an settlement for world rights to a Section 1-ready antibody drug conjugate (ADC) from Foreseen Biotechnology. That deal adopted the April acquisition of world rights to an ADC
from Sutro Biopharma. Ipsen’s oncology curiosity extends to different sorts of medicine. In 2022, months after the Epizyme acquisition, Ipsen started a partnership with Marengo Therapeutics centered on the R&D of T cell receptor therapies for most cancers.

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