publication date: Apr. 1, 2016
AVEO Execs Face Fraud Charges from SEC; Company to Pay $4 Million to Settle
The Securities and Exchange Commission March 29 announced fraud charges against AVEO Pharmaceuticals Inc., a biotechnology company, and three of its former executives.
SEC said the company agreed to pay a $4 million penalty to settle the charges without admitting or denying the allegations.
The agency said it is continuing to pursue its case against three of AVEO’s former officers: CEO Tuan Ha-Ngoc, Chief Financial Officer David Johnston, and Chief Medical Officer William Slichenmyer.
In court documents, SEC said that AVEO didn’t disclose the extent of the agency’s concern about tivozanib in public statements to investors. Specifically, the company didn’t disclose that FDA staff had recommended a new clinical trial to address the concerns about patient death rates during the first clinical trial, the complaint states.
Months later, when FDA made a public statement that it had recommended an additional clinical trial, the company’s stock price dropped by nearly a third. The trial was never conducted and the drug wasn’t approved.
The complaint, filed at the U.S. District Court for the District of Massachusetts, is posted here as a PDF. The document draws on AVEO internal documents to demonstrate the insider’s view of the tivozanib development program.
Court documents don’t mention any of the company’s board members, and focus entirely on AVEO’s former executives—what they knew, and when they knew … Continue reading 42-13 AVEO Execs Face Fraud Charges from SEC; Company to Pay $4 Million to Settle
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