The Securities and Exchange Commission (SEC) has charged a former Pfizer insider with insider trading related to the release of trial results from COVID-19 drug Paxlovid. 

On Thursday, June 29, the SEC revealed that former Pfizer statistician Amit Dagar, 44, of Hillsborough, New Jersey, and his business associate Atul Bhiwapurkar, 45, of Milpitas, California, purchased short-term stock options, including some that expired the next day, after Dagar was made aware Paxlovid’s success in clinical trials by his supervisor. The stocks were purchased the day before Pfizer was set to share the trial findings. 

Those results were announced on November 5, 2021, and subsequently, Pfizer’s shares climbed by 11%—the company’s largest single day increase in more than a decade.  

For Dagar, the trades garnered $214,395 in profit, while his business associate raked in $60,300. The trades were flagged by the SEC’s Market Abuse Unit’s Analysis and Detection Center for suspicious 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.” 

In Paxlovid’s drug trial, Dagar served as senior statistical program lead. His lawyer argues that his role was blinded and that Dagar was not aware, and was not made aware of, the study’s results prior to the public announcement. However, the SEC maintains that Dagar was made aware of Paxlovid’s success prior to the announcement via chat with his supervisor. 

Dagar is being charged with conspiracy and four counts of securities fraud and his associate Bhiwapurkar faces conspiracy and two counts of securities fraud. 

Read SEC’s release on the matter here.