Huge Paydays for Vax Execs

by Ryan Basen, Enterprise & Investigative Writer, MedPage Today

Insiders at COVID Vaccine Makers Raking It In

Executives and hedge funds are cashing in as stock prices spike for pharmaceutical companies and other potential COVID-19 vaccine makers — regardless of the companies’ legitimate progress in producing a vaccine, according to the New York Times, which reviewed data from Equilar.

Insiders from at least 11 companies have sold shares worth more than $1 billion since March, the newspaper reports. Many have cashed out just before announcements of deals with the federal government’s Operation Warp Speed vaccine development program.

“Some companies are attracting government scrutiny for potentially using their associations with Operation Warp Speed as marketing ploys,” the newspaper noted.

The Times cites the case of biotech company Regeneron, whose shares have soared nearly 80% since early February, when it trumpeted its deal with the Department of Health and Human Services. Over that span, top executives and board members have sold nearly $700 million in stock — including CEO Leonard Schleifer, who sold $178 million worth of shares in one day.

The newspaper also details the case of Vaxart, a San Francisco company that touted a deal with the government in late June. But that agreement, for including its vaccine among several to be tested in primates, was not a major facet of Operation Warp Speed, the government told the Times. Yet the company has sought to connect its agreement to the program.

The New York hedge fund Armistice Capital owned almost two-thirds of Vaxart’s stock as of the beginning of the year, when a share was valued at about 35 cents. As the price shot up 3,600% in the wake of its vaccine announcement, the fund earned more than $197 million flipping its shares. Stock options held by CEO Andrei Floroiu were valued at $4.3 million in mid-June; a month later they were worth more than $28 million.

“It’s OK to make a profit from COVID vaccines, as long as you’re not profiteering,” he said in an investor’s conference last week.

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