Clouds over Novartis thicken in gene therapy drug scandal
A Novartis executive sold almost $1 million worth of company shares weeks before the FDA accused the Big Pharma company of manipulating results for its gene therapy Zolgensma.
Francois Murphy had the news for Reuters:
An unnamed Novartis executive sold 925,400 Swiss francs ($946,000) worth of shares less than three weeks before the U.S. Food and Drug Administration (FDA) announced data from tests of its gene therapy Zolgensma had been manipulated.
Novartis announced the stock sale by an executive member of the board of directors or a member of the executive committee in a Swiss stock exchange filing dated July 19. The sale was first reported by Swiss newspaper SonntagsZeitung on Sunday.
A Novartis spokesman told Reuters, “As is usual in such cases, the transaction was thoroughly checked beforehand and then approved accordingly. The person in question was not in possession of relevant material information.”
The sale was made after the company had informed the FDA about the data manipulation but before the FDA announced it publicly on Aug 6.
Bloomberg’s Patrick Winters reported:
The Swiss pharma company is under fire from U.S. lawmakers who say it should have told regulators about data irregularities before the drug’s approval in May, rather than waiting to conclude an internal investigation. The company told the FDA in June that it had discovered the potential manipulation of animal-testing data related to the medication, after the $2.1 million-a-dose treatment had already hit the U.S. market.
Chief Executive Officer Vas Narasimhan said the company could have handled a furor surrounding Zolgensma better. Narasimhan, who became CEO of the pharmaceutical manufacturer last year, made the comment in a company call with 12,000 managers, according to newspaper Schweiz am Wochenende report yesterday.
Pharmaforum noted Novartis had insisted the stock seller had not been privy to any manipulation-related information:
The company insists that the person selling the shares – reported to be an executive member of the board of directors or a member of the executive committee at Novartis AG – had no materially-relevant information about the Zolgensma data issue.
Nevertheless, the revelation that the sale occurred after the company had informed the FDA of the problem but before the news became public has raised eyebrows, and is another problem for Novartis chief executive Vas Narasimhan to tackle as he tries to restore the firm’s reputation.
The FDA revealed earlier this month that it may take action against Novartis after discovering that data filed to support approval of Zolgensma (onasemnogene abeparvovec) – a spinal muscular atrophy gene therapy developed by its AveXis subsidiary – had been manipulated.
It also said the company was aware of the problem before Zolgensma was approved by the FDA in May but only informed the agency of its findings in June, sparking calls by US lawmakers for the US regulator to come down hard on the company with “all appropriate criminal, civil, and regulatory actions.”