SEC Charges Former Pfizer Statistician with Insider Trading Ahead of COVID-19 Announcement

The Securities and Exchange Commission today announced insider trading charges against Amit Dagar, a former Pfizer Inc. employee, and his close friend and business partner, Atul Bhiwapurkar, for trading in advance of the company’s November 5, 2021, announcement that a randomized, double-blind study of its COVID-19 antiviral treatment, Paxlovid, was successful. Following that announcement in which Pfizer’s CEO referred to the news as a “game-changer” in the global efforts to “halt the devastation” of the pandemic, the company’s stock price increased by nearly 11 percent, the largest single-day price move in the stock since 2009.

According to the SEC’s complaint, Dagar was a senior statistical program lead for the Paxlovid drug trial, which began in July 2021 as part of the company’s efforts to address the global health pandemic. On the day before the Paxlovid announcement, the complaint alleges, Dagar learned material, nonpublic information about the success of the trial. Specifically, the SEC alleges that Dagar’s supervisor informed him via chat that “we got the outcome,” there was a “lot of work lined up,” and that there would be a “press release tomorrow,” to which Dagar responded with “oh really” and “kind of exciting.” Several hours after that exchange, Dagar allegedly purchased short term, out-of-the-money Pfizer call options, including options that expired the very next day, and then tipped Bhiwapurkar, who also purchased similar call options in Pfizer. The complaint alleges that Dagar’s and Bhiwapurkar’s trading generated approximately $214,395 and $60,300 respectively in illicit profits, which amounted to one-day investment returns of 2,458 percent and 791 percent.

The case originated from the SEC’s Market Abuse Unit’s Analysis and Detection Center, which uses data analysis tools to detect suspicious trading patterns.

“As alleged in our complaint, Amit Dagar misused his access to confidential clinical trial results to enrich himself and his friend, Atul Bhiwapurkar,” said Joseph Sansone, Chief of the Market Abuse Unit. “Dagar and Bhiwapurkar allegedly leveraged this information by trading out-of-the-money call options to generate massive one-day returns. Thanks to our surveillance, the defendants must now face the consequences of their greed.”

The SEC’s complaint, filed in U.S. District Court for the Southern District of New York, charges Dagar and Bhiwapurkar with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Exchange Act Rule 10b-5 thereunder and seeks injunctive relief, disgorgement with prejudgment interest, and civil penalties. 

In a parallel action, the U.S. Attorney's Office for the Southern District of New York today announced criminal charges against Dagar and Bhiwapurkar.

The SEC’s investigation, which is ongoing, is being conducted by Market Abuse Unit staff member Colby Steele, with the assistance of Patrick McCluskey of the Market Abuse Unit’s Analysis and Detection Center, and is being supervised by Paul Kim and Mr. Sansone. The SEC's litigation will be led by Charlie Divine and Mr. Steele under the supervision of James Connor. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the FBI.


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