Insider trading charges were brought against Donna L. Matuizek (“Matuizek”), a resident of Burien, Washington, by the Securities and Exchange Commission (SEC) today. Matuizek was accused of trading in the securities of Pandion Therapeutics, Inc. (“Pandion”) before the announcement that Merck & Co., Inc. (“Merck”) had agreed to acquire all outstanding Pandion stock through a tender offer.
According to the order issued by the SEC, Matuizek obtained material nonpublic information regarding a potential transaction between Merck and Pandion through her role as Vice President of Quality for a drug manufacturer and key Pandion supplier. This information was the subject of a due diligence audit conducted by Merck with the acquisition.
Matuizek is found to have violated her duty to both her employer and to Pandion by purchasing Pandion stock on February 16, 2021, while being aware of and based on that material nonpublic knowledge. This is the conclusion reached by the order. During the period in which the stock price of Pandion increased by about 133% after the announcement of Merck’s tender offer on February 25, 2021, Matuizek was able to acquire ill-gotten gains amounting to $27,800, as stated in the ruling.
Matuizek is found to have violated the antifraud provisions of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934, as well as Rules 10b-5 and 14e-3(a) thereunder, according to the ruling issued by the Securities and Exchange Commission. Matuizek consented to settle the accusations by consenting to a cease-and-desist order and paying disgorgement of $27,800, prejudgment interest of $1,717.96, and a civil penalty of $27,800. He did not admit or refute the findings of the SEC that were presented to him.
Derek M. Schoenmann, Tracy E. Sivitz, Chevon Walker, John S. Rymas, and Simona K. Suh, all of whom are members of the Enforcement Division’s Market Abuse Unit, and Neil Hendelman, who is a member of the New York Regional Office, were the individuals who carried out the investigation for the Securities and Exchange Commission. A Chief of the Market Abuse Unit named Joseph G. Sansone was in charge of supervising it. The Financial Industry Regulatory Authority has been of great service to the Securities and Exchange Commission.
Former Merck VP Settles Insider Trading Case with SEC
Pandion Therapeutics was acquired by Merck for a total of $1.9 billion, which was a significant victory for stakeholders in the Massachusetts-based biotechnology company. Price of Pandion shares increased from $25.63 to $59.81 in a single day, a significant increase.
According to the Securities and Exchange Commission (SEC), however, the gains were obtained through unethical means for a number of the owners within the company. In the previous year, the Securities and Exchange Commission (SEC) brought charges against three individuals for engaging in insider trading, which resulted in a total of $2.5 million in fines. In addition, the Securities and Exchange Commission (SEC) has settled with another individual who allegedly utilised insider information to purchase Pandion shares before the transaction.
When the Pandion purchase was revealed, Nirdosh Jagota, who is now 61 years old and worked for Merck as a vice president of global regulatory affairs, reached an agreement with the Securities and Exchange Commission (SEC). Before the merger that will take place on February 25, Jagota will give back the $39,660 that he made from the two stock acquisitions that he made on February 9 and February 17.
Jagota, who departed Merck in August of 2021 and has subsequently held roles at three other biopharmaceutical companies, will also be required to pay a civil penalty of $39,660 and prejudgment interest of $3,605.
In addition, he has consented to refrain from the position of officer or director of a public firm for three years. Since the beginning of July, Jagota has served as Amgen’s Vice President of Quality. On Thursday, a representative for Amgen announced that he has left the company and is no longer employed there.
The Securities and Exchange Commission (SEC) stated that Jagota, who did not admitted or refute the findings of the SEC, was in charge of a team that conducted due diligence for Merck in relation to the transaction.
Earlier than the Sanofi takeover, a former Kadmon consultant has entered a guilty plea to insider trading charges.
Seth Markin, who is 32 years old, was charged with insider trading regarding the Merck-Pandion merger by the Securities and Exchange Commission (SEC) in the previous year. A binder of private material that Markin, a former FBI trainee, discovered at the residence of his love partner, a lawyer who represented Merck, is said to have been the source of Markin’s discovery of the transaction, according to the Securities and Exchange Commission (SEC).
An allegation made by the Securities and Exchange Commission (SEC) is that Markin disclosed the knowledge to his friend Brandon Wong, who gained $1.2 million from his stock transactions. According to the Securities and Exchange Commission (SEC), Wong’s brother Brian was also informed about the acquisition and that he profited $400,000 from the stock that he purchased in Pandion.
Donna Matuizek was also charged with insider trading in a separate case that was resolved in January of this year. The charges stemmed from the fact that she was aware of the Merck-Pandion deal. Matuizek, who allegedly became aware of the transaction while working as the vice president of quality at Just Biotherapeutics, reportedly profited $27,800 from the purchase of her stock, according to the Securities and Exchange Commission.
According to the SEC, Just Bio, which is based in Seattle, was a significant supplier of Pandion. Along the same lines as Jagota, Matuizek surrendered her gains and paid a civil penalty equal to $27,800. She did this without acknowledging or contesting the facts about the situation. In July of 2022, she resigned from her position at Just Bio.
In the fiscal year 2017–18, the Securities and Exchange Board of India (SEBI) initiated investigations into 117 new cases concerning violations of securities laws, including insider trading. This marked a significant decrease from the 245 cases investigated in the previous fiscal year. Of these 117 cases, approximately 15% pertained to insider trading, while 34% involved market manipulation and price rigging, and the remaining 51% related to other securities law violations.
One notable insider trading case during this period involved a leading aquaculture company. SEBI’s investigation revealed that key insiders, including the company’s promoter and managing director, traded the company’s stock based on unpublished price-sensitive information (UPSI) prior to the official disclosure of significant financial results. The individuals involved were found guilty of insider trading, leading to penalties, disgorgement of unlawful gains, and trading bans.
These actions underscore SEBI’s commitment to enforcing securities laws and maintaining market integrity by addressing insider trading and other violations.
