Bloomberg Law
Free Newsletter Sign Up
Login
BROWSE
Bloomberg Law
Welcome
Login
Advanced Search Go
Free Newsletter Sign Up

Ex-Immunomedics CFO Usama Malik Charged With Insider Trading (2)

Dec. 2, 2021, 6:55 PMUpdated: Dec. 2, 2021, 6:38 PM

The former chief financial officer for Immunomedics Inc. was charged with securities fraud for allegedly sharing confidential information about clinical trials with his romantic partner, the company’s corporate communications head.

Usama Malik was CFO at the time of the company’s $21 billion acquisition by Gilead Sciences Inc. Prosecutors allege that he told his partner, Lauren Wood, about a successful clinical trial for a breast cancer drug within minutes of learning the results himself in April 2020. He also shared the information with some relatives.

Malik and Wood were both arrested Dec. 1 on securities fraud charges. They are scheduled to appear in federal court in Washington on Thursday afternoon.

A representative for Gilead declined to comment. Patrick Smith, a lawyer for Malik, and John Yauch, a federal public defender representing Wood, didn’t immediately respond to requests for comment.

According to prosecutors, Wood placed an order for about 7,000 Immunomedics shares based on Malik’s tip, selling them after the announcement of the clinical trial results for gross profits of more than $213,000. She allegedly gave $65,000 of the profits to Malik.

While the company was not identified by prosecutors, the Securities and Exchange Commission filed a separate lawsuit against Malik and Wood stating they worked for Immunomedics. The company developed a breast-cancer treatment called Trodelvy that gained approval from the U.S. Food and Drug Administration in April 2020.

According to the SEC, Malik failed to identify Wood as his romantic partner when asked about her trading as part of a Financial Industry Regulatory Authority inquiry. He also falsely claimed that he had not communicated with her during the relevant period, the regulator said.

Malik has worked as a director and chief executive officer of Fore Biotherapeutics since February. His employment was terminated on Thursday after the company became aware of the charges, Fore said in a statement.

The case is US v Malik, 21-mj-11371, U.S. District Court, District of New Jersey.

(Updates with attempt to reach defense lawyers.)

--With assistance from John Tozzi.

To contact the reporter on this story:
Chris Dolmetsch in Federal Court in Manhattan at cdolmetsch@bloomberg.net

To contact the editors responsible for this story:
Katia Porzecanski at kporzecansk1@bloomberg.net

Anthony Lin

© 2021 Bloomberg L.P. All rights reserved. Used with permission.