The stock market policeman demands 4 million euros against AB Science and its CEO

Posted Feb 11 2022 at 18:54Updated Feb 11. 2022 at 19:04

This is the second time that Alain Moussy and AB Science, the biotech he founded in 2001, have appeared before the sanctions commission of the Autorité des marchés financiers (AMF). Both were sentenced in June 2016 to pay the Public Treasury 200,000 euros for failure to communicate information to the market before a capital increase in 2013. They had not warned early enough of the risk of refusal of authorization for the marketing of their flagship molecule, mastinib, intended for the treatment of GIST (gastrointestinal stromal tumors).

Communication fault

The case brought before the AMF judge on Friday dates from 2017 and concerns comparable facts. The college of the AMF (the equivalent of the prosecutor) also criticizes AB Science for a lack of communication. The company did not inform investors that it risked being refused marketing of mastinib, this time to treat mastocytosis (a rare skin disease).

In view of the meeting of the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency, this refusal was however likely from March 7, 2017, estimates the college. However, the company waited for the final decision of the CHMP to communicate, on May 17.

The rapporteur for the Sanctions Committee (who is investigating the case but whose opinion is not prescriptive) believes that the company had this privileged information on April 7.

Divergence of points of view

This divergence of points of view is essential. Because the college accuses the group of not having informed the market before two private placements, on March 27 and 31. Depending on the date used to characterize the privileged information, the public was or was not misled.

In addition, in one case, the delay in communication allegedly lasted more than two months; in the other, a month and a half. “Before May 17, AB Science was certain of having every chance of obtaining a positive opinion. Until the end, she did not let go, ”argued the biotech lawyer.

Insider trading

Insider trading is also in the sights of the stock market policeman. On March 31, 2017, Alain Moussy sold shares worth €5 million, realizing a “loss saving” of €1.7 million. Here again, the date of the privileged information is essential to assess the breach. Alain Moussy cannot be accused of having used privileged information on March 31 if the latter was not. “His decision to sell dates back to the end of 2016. He had loan installments to repay. Alain Moussy did not speculate,” said Nicolas Viguié, Alain Moussy’s lawyer.

The AMF college demanded 1 million euros against AB Science and 3 million against its CEO for lack of information and insider trading.

Insider trading

In addition, on April 21, Grégory Pepin, a fund manager, sold AB Science shares, on the strength of information that would have been transmitted to him by Olivier Hermine, professor of medicine, and director of clinical strategy at AB Science. . He knew that a negative opinion was going to be given for mastinib. Both are accused of the same shortcomings in 2018, this time before the CHMP issued a negative opinion for ALS (amyotrophic lateral sclerosis).

The AMF college demanded 2 million against Grégory Pepin for use of privileged information, and 100,000 euros against Olivier Hermine for transmission of the latter.

The Sanctions Committee will make its decision within a month.

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