Former Biopharmaceutical Executive Charged with Insider Trading
Litigation Release No. 24697 / December 20, 2019
Securities and Exchange Commission v. Wang, No. 19-civ-12557 (D. Mass.) filed December 20, 2019
December 20, 2019 - The Securities and Exchange Commission announced insider trading charges against Songjiang Wang, a Massachusetts resident and former Director of Statistical Programming at Merrimack Pharmaceuticals, Inc.
According to the SEC's complaint, Wang tipped his close friend, Jason "Schultz" Chan, to trade Merrimack securities in advance of the company announcing positive drug trial results. The SEC further alleges that Chan later returned the favor and tipped Wang with nonpublic information about a successful drug trial conducted by Chan's employer, Akebia Therapeutics, Inc. The complaint alleges Wang made approximately $108,000 trading Akebia securities based on Chan's tips. The SEC previously charged Chan with insider trading in connection with this investigation.
Both Wang and Chan were charged with insider trading by the U.S. Attorney's Office for the District of Massachusetts and were criminally convicted after a jury trial. They are currently in the process of appealing their convictions.
The SEC's complaint charges Wang with violating the antifraud provisions of Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder and seeks disgorgement of Wang's illegal profits, a civil penalty, an injunction, and an officer-and-director bar.
The SEC's investigation was conducted by Charu Chandrasekhar, David Oliwenstein and Simona Suh of the SEC's Market Abuse Unit, and Neil Hendelman of the SEC's New York Office and was supervised by the Market Abuse Unit's Chief, Joseph G. Sansone. The litigation against Wang will be led by Ms. Suh, Paul Gizzi of the SEC's New York Office and Martin Healey of the SEC's Boston Office. The SEC appreciates the assistance of the U.S. Attorney's Office for the District of Massachusetts, the Federal Bureau of Investigation, and the Financial Industry Regulatory Authority.