Amit Dagar, once a trusted statistician for pharmaceutical behemoth Pfizer Inc PFE, and Atul Bhiwapurkar, his close business ally, now find themselves mired in allegations that could see their financial futures irreparably tarnished.
In this week's installment of Financial Crime Weekly, Benzinga delves into a recent alleged insider trading scandal surrounding Pfizer, one of the companies at the forefront of the global pandemic response.
Pfizer's Insider Trading Quagmire: Both Dagar and Bhiwapurkar are accused of exploiting Pfizer's announcement about the success of its Paxlovid trial on Nov. 5, 2021.
The New York City-based company saw its shares move 11% to the upside on the day it announced the success of its Paxlovid trial — the biggest single-day move the stock has seen since 2009. Dagar, a former senior statistical program lead for the Paxlovid drug trial, and his friend Bhiwapurkar allegedly exploited their insider knowledge, according to the Securities and Exchange Commission (SEC).
Dagar, with the inside scoop, made moves on short-term out-of-the-money Pfizer call options. He then shared the information with Bhiwapurkar, who mirrored his trade.
The alleged trades yielded staggering profits — $214,395 for Dagar and $60,300 for Bhiwapurkar. The one-day returns, clocking in at 2,458% and 791% respectively, did not go unnoticed by the SEC.
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SEC Intervenes: The SEC’s complaint accuses the duo of antifraud violations. The SEC is pursuing injunctive relief, disgorgement with prejudgment interest, and civil penalties.
The probe, announced in July of this year, originated from the SEC's Market Abuse Unit's Analysis and Detection Center, spotlighting its data-driven approach in identifying questionable trading patterns.
Simultaneously, the U.S. Attorney's Office for the Southern District of New York slapped Dagar and Bhiwapurkar with corresponding criminal charges.
The case is currently being investigated, and it underlines the inherent dangers and potential fallout of insider trading.
Stay with Benzinga for updates on this development and other tales from the financial underworld.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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