U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19194 / April 20, 2005
SEC v. Hanna, 05 CV 3996 (LTS) (S.D.N.Y.)
SEC SETTLES INSIDER TRADING MATTER AGAINST FORMER CHIEF SCIENTIFIC OFFICER OF BIOGEN IDEC, INC.
The Securities and Exchange Commission announced today that it filed a settled civil action in the United States District Court for the Southern District of New York against Dr. Nabil Hanna ("Hanna"). Hanna is a resident of Rancho Santa Fe, California, and the former Executive Vice President of Research and Chief Scientific Officer of Biogen Idec, Inc. ("Biogen"). In its Complaint, the Commission alleged that Hanna obtained approximately $124,000 in illicit profits from insider trading in the securities of Regeneron Pharmaceuticals, Inc. ("Regeneron") in advance of Regeneron's announcement on September 8, 2003 that it had entered into an agreement with Aventis, SA to develop and market a potential cancer treatment known as the VEGF-Trap ("the VEGF-Trap").
More specifically, in its Complaint, the Commission alleged the following. In early July 2003, Regeneron's representatives contacted Biogen to discuss a potential joint venture to develop and market Regeneron's VEGF-Trap. Shortly thereafter, Biogen representatives, including Hanna, and Regeneron representatives began discussing the possible joint venture. During the course of these confidential discussions, which continued through early September, Hanna learned that the VEGF-Trap was scientifically and commercially viable; that Regeneron's preclinical stage testing of the VEGF-Trap produced positive results; that the VEGF-Trap had blockbuster sales potential; and the financial terms Regeneron required for the joint venture. On August 18 and 19, 2003, while in possession of this material, nonpublic information, Hanna purchased 17,500 shares of Regeneron stock at prices ranging from $13.95 to $14.15 per share. On September 9, 2003, one day after Regeneron announced its agreement with Aventis, SA , Hanna sold all 17,500 shares of Regeneron stock at $21.15 per share, realizing a profit of $124,000.
Without admitting or denying the allegations in the Commission's Complaint, Hanna consented to the entry of a final judgment by the Court, which permanently enjoins Hanna from future violations of Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Hanna also consented to pay disgorgement of $124,000, plus prejudgment interest, and a civil penalty of $248,000. Additionally, Hanna agreed to the entry of an order barring him from serving as an officer or director of a public company.
