Biopharmaceutical Employees Convicted of Insider Trading
BOSTON – Two employees of Cambridge-based biopharmaceutical companies were convicted today by a federal jury of engaging in an insider trading scheme.
Schultz “Jason” Chan, 54, of Newton, the Director of Biostatistics at a Cambridge-based biopharmaceutical company, was convicted of one count of conspiracy to commit securities fraud and three counts of securities fraud. Songjiang Wang, 54, of Westford, the Director of Statistical Programming at a different biopharmaceutical company, was convicted of one count of conspiracy to commit securities fraud and two count of securities fraud. U.S. District Court Judge Indira Talwani scheduled Chan’s and Wang’s sentencings for Oct. 4 and 5, 2018, respectively.
From August 2013 to September 2015, Wang and Chan, who were friends, conspired to commit securities fraud by trading insider information regarding successful clinical drug trials at their respective companies. Specifically, Wang traded on inside information Chan provided regarding a clinical study conducted by Chan’s employer. In addition, over a period of several months, Wang tipped Chan of clinical trial results of a Phase 3 clinical trial being conducted by his employer. Furthermore, Wang gave Chan cash, which Chan used to purchase stock shares of Wang’s employer. Chan subsequently sold those shares and paid back Wang.
The charge of securities fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $5 million. The charge of conspiracy to commit securities fraud provides for a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division, made the announcement today. The United States Attorney’s Office received valuable assistance from the Securities and Exchange Commission. Assistant U.S. Attorney Jordi de Llano Campos, Deputy Chief of Lelling’s Economic Crimes Unit, and Assistant United States Attorney Kriss Basil, also of the Economic Crimes Unit, are prosecuting the case.