Connetics Executive Charged
The Securities and Exchange Commission charged an executive at specialty pharmaceutical firm Connetics Corp. with insider trading Tuesday, saying he sold stock after learning that health regulators had negative views on an experimental acne drug.
Alexander Yaroshinsky, a vice president at the Palo Alto-based company, made at least $680,000 related to the rejection by the Food and Drug Administration of the acne drug Velac, the SEC said.
Yaroshinsky’s attorney could not be reached for comment.
The SEC said Yaroshinsky positioned himself to profit from a fall in Connetics’ stock price after learning in April 2005 that the FDA’s preliminary views concluded that the drug was “unsafe for use.â€
Between the time he learned of the FDA views and until a few days before the June 13, 2005, news release of the FDA decision, Yaroshinsky sold 15,100 Connetics shares and bought 2,076 contracts that gave him the right to sell Connetics shares at a fixed price, the SEC said.
Yaroshinsky had learned of the FDA’s negative views of Velac Gel after studying its effect on mice, the suit said.
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