Saturday, July 25, 2020
U.S. - Corporate Insiders Pocket $1 Billion in Rush for #Coronavirus Vaccine
Vaxart’s shares soared. Company insiders, who weeks earlier had received stock options worth a few million dollars, saw the value of those awards increase sixfold. And a hedge fund that partly controlled the company walked away with more than $200 million in instant profits.
The race is on to develop a coronavirus vaccine, and some companies and investors are betting that the winners stand to earn vast profits from selling hundreds of millions — or even billions — of doses to a desperate public.
Across the pharmaceutical and medical industries, senior executives and board members are capitalizing on that dynamic.
They are making millions of dollars after announcing positive developments, including support from the government, in their efforts to fight Covid-19. After such announcements, insiders from at least 11 companies — most of them smaller firms whose fortunes often hinge on the success or failure of a single drug — have sold shares worth well over $1 billion since March, according to figures compiled for The New York Times by Equilar, a data provider.
In some cases, company insiders are profiting from regularly scheduled compensation or automatic stock trades. But in other situations, senior officials appear to be pouncing on opportunities to cash out while their stock prices are sky high. And some companies have awarded stock options to executives shortly before market-moving announcements about their vaccine progress.
The sudden windfalls highlight the powerful financial incentives for company officials to generate positive headlines in the race for coronavirus vaccines and treatments, even if the drugs might never pan out.
Some companies are attracting government scrutiny for potentially using their associations with Operation Warp Speed as marketing ploys. For example, the headline on Vaxart’s news release declared: “Vaxart’s Covid-19 Vaccine Selected for the U.S. Government’s Operation Warp Speed.” But the reality is more complex.
Vaxart’s vaccine candidate was included in a trial on primates that a federal agency was organizing in conjunction with Operation Warp Speed. But Vaxart is not among the companies selected to receive significant financial support from Warp Speed to produce hundreds of millions of vaccine doses.
“The U.S. Department of Health and Human Services has entered into funding agreements with certain vaccine manufacturers, and we are negotiating with others. Neither is the case with Vaxart,” said Michael R. Caputo, the department’s assistant secretary for public affairs. “Vaxart’s vaccine candidate was selected to participate in preliminary U.S. government studies to determine potential areas for possible Operation Warp Speed partnership and support. At this time, those studies are ongoing, and no determinations have been made.”
Some officials at the Department of Health and Human Services have grown concerned about whether companies including Vaxart are trying to inflate their stock prices by exaggerating their roles in Warp Speed, a senior Trump administration official said. The department has relayed those concerns to the Securities and Exchange Commission, said the official, who spoke on the condition of anonymity.
It isn’t clear if the commission is looking into the matter. An S.E.C. spokeswoman declined to comment.
“Vaxart abides by good corporate governance guidelines and policies and makes decisions in accordance with the best interests of the company and its shareholders,” Vaxart’s chief executive, Andrei Floroiu, said in a statement on Friday. Referring to Operation Warp Speed, he added, “We believe that Vaxart’s Covid-19 vaccine is the most exciting one in O.W.S. because it is the only oral vaccine (a pill) in O.W.S.”
Well-timed stock transactions are generally legal. But investors and corporate governance experts say they can create the appearance that executives are profiting from inside information, and could erode public confidence in the pharmaceutical industry when the world is looking to these companies to cure Covid-19.
“It is inappropriate for drug company executives to cash in on a crisis,” said Ben Wakana, executive director of Patients for Affordable Drugs, a nonprofit advocacy group. “Every day, Americans wake up and make sacrifices during this pandemic. Drug companies see this as a payday.”
Executives at a long list of companies have reaped seven- or eight-figure profits thanks to their work on coronavirus vaccines and treatments.
Shares of Regeneron, a biotech company in Tarrytown, N.Y., have climbed nearly 80 percent since early February, when it announced a collaboration with the Department of Health and Human Services to develop a Covid-19 treatment. Since then, the company’s top executives and board members have sold nearly $700 million in stock. The chief executive, Leonard Schleifer, sold $178 million of shares on a single day in May.
Alexandra Bowie, a spokeswoman for Regeneron, said most of those sales had been scheduled in advance through programs that automatically sell executives’ shares if the stock hits a certain price.
Moderna, a 10-year-old vaccine developer based in Cambridge, Mass., that has never brought a product to market, announced in late January that it was working on a coronavirus vaccine. It has issued a stream of news releases hailing its vaccine progress, and its stock has more than tripled, giving the company a market value of almost $30 billion.
Moderna insiders have sold about $248 million of shares since that January announcement, most of it after the company was selected in April to receive federal funding to support its vaccine efforts.
While some of those sales were scheduled in advance, others were more spur of the moment. Flagship Ventures, an investment fund run by the company’s founder and chairman, Noubar Afeyan, sold more than $68 million worth of Moderna shares on May 21. Those transactions were not scheduled in advance, according to securities filings.Executives and board members at Luminex, Quidel and Emergent BioSolutions have sold shares worth a combined $85 million after announcing they were working on vaccines, treatments or testing solutions.
At other companies, executives and board members received large grants of stock options shortly before the companies announced good news that lifted the value of those options.
Novavax, a drugmaker in Gaithersburg, Md., began working on a vaccine early this year. This spring, the company reported promising preliminary test results and a $1.6 billion deal with the Trump administration.
In April, with its shares below $24, Novavax issued a batch of new stock awards to all its employees “in acknowledgment of the extraordinary work of our employees to implement a new vaccine program.” Four senior executives, including the chief executive, Stanley Erck, received stock options that were worth less than $20 million at the time.
Since then, Novavax’s stock has rocketed to more than $130 a share. At least on paper, the four executives’ stock options are worth more than $100 million.
So long as the company hits a milestone with its vaccine testing, which it is expected to achieve soon, the executives will be able to use the options to buy discounted Novavax shares as early as next year, regardless of whether the company develops a successful vaccine. Silvia Taylor, a Novavax spokeswoman, said the stock awards were designed “to incentivize and retain our employees during this critical time.” She added that “there is no guarantee they will retain their value.”
Two other drugmakers, Translate Bio and Inovio, awarded large batches of stock options to executives and board members shortly before they announced progress on their coronavirus vaccines, sending shares higher. Representatives of the companies said the options were regularly scheduled annual grants.
Vaxart, though, is where the most money was made the fastest.
At the start of the year, its shares were around 35 cents. Then in late January, Vaxart began working on an orally administered coronavirus vaccine, and its shares started rising. Vaxart’s largest shareholder was a New York hedge fund, Armistice Capital, which last year acquired nearly two-thirds of the company’s shares. Two Armistice executives, including the hedge fund’s founder, Steven Boyd, joined Vaxart’s board of directors. The hedge fund also purchased rights, known as warrants, to buy 21 million more Vaxart shares at some point in the future for as little as 30 cents each. Vaxart has never brought a vaccine to market. It has just 15 employees. But throughout the spring, Vaxart announced positive preliminary data for its vaccine, along with a partnership with a company that could manufacture it. By late April, with investors sensing the potential for big profits, the company’s shares had reached $3.66 — a tenfold increase from January.
On June 8, Vaxart changed the terms of its warrants agreement with Armistice, making it easier for the hedge fund to rapidly acquire the 21 million shares, rather than having to buy and sell in smaller batches.
One week later, Vaxart announced that its chief executive was stepping down, though he would remain chairman. The new C.E.O., Mr. Floroiu, had previously worked with Mr. Boyd, Armistice’s founder, at the hedge fund and the consulting firm McKinsey.
On June 25, Vaxart announced that it had signed a letter of intent with another company that might help it mass-produce a coronavirus vaccine. Vaxart’s shares nearly doubled that day.
The next day, Vaxart issued its news release saying it had been selected for Operation Warp Speed. Its shares instantly doubled again, at one pointing hitting $14, their highest level in years.
“We are very pleased to be one of the few companies selected by Operation Warp Speed, and that ours is the only oral vaccine being evaluated,” Mr. Floroiu said.
Armistice took advantage of the stock’s exponential increase — at that point up more than 3,600 percent since January. On June 26, a Friday, and the next Monday, the hedge fund exercised its warrants to buy nearly 21 million Vaxart shares for either 30 cents or $1.10 a share — purchases it would not have been able to make as quickly had its agreement with Vaxart not been modified weeks earlier.
Armistice then immediately sold the shares at prices from $6.58 to $12.89 a share, according to securities filings. The hedge fund’s profits were immense: more than $197 million.“It looks like the warrants may have been reconfigured at a time when they knew good news was coming,” said Robert Daines, a professor at Stanford Law School who is an expert on corporate governance. “That’s a valuable change, made right as the company’s stock price was about to rise.”
At the same time, the hedge fund also unloaded some of the Vaxart shares it had previously bought, notching tens of millions of dollars in additional profits.
By the end of that Monday, June 29, Armistice had sold almost all of its Vaxart shares.
Mr. Boyd and Armistice declined to comment.
Mr. Floroiu said the change to the Armistice agreement “was in the best interests of Vaxart and its stockholders” and helped it raise money to work on the Covid-19 vaccine.
He and other Vaxart board members also were positioned for big personal profits. When he became chief executive in mid-June, Mr. Floroiu received stock options that were worth about $4.3 million. A month later, those options were worth more than $28 million.
Normally when companies issue stock options to executives, the options can’t be exercised for months or years. Because of the unusual terms and the run-up in Vaxart’s stock price, most of Mr. Floroiu’s can be cashed in now.
Vaxart’s board members also received large grants of stock options, giving them the right to buy shares in the company at prices well below where the stock is now trading. The higher the shares fly, the bigger the profits.
“Vaxart is disrupting the vaccine world,” Mr. Floroiu boasted during a virtual investor conference on Thursday. He added that his impression was that “it’s OK to make a profit from Covid vaccines, as long as you’re not profiteering.”
https://www.nytimes.com/2020/07/25/business/coronavirus-vaccine-profits-vaxart.html?action=click&module=Top%20Stories&pgtype=Homepage
#Chinese Dream: Xi’s attempted coup against #Pakistan
China's Communist leader has managed the creation of a supra-constitutional CPEC Authority.
Xi Jinping is all set to sideline the democratically elected representatives and civil servants of the people of Pakistan so as to expand his direct influence over the political and economic processes of the country.
Since 2016, Xi, the general secretary of the Communist Party of China has been forcing the Pakistani establishment to put pressure on the government (it was Nawaz Sharif’s government back then) to sideline the Planning Ministry’s role in the implementation and monitoring of the multibillion-dollar China-Pakistan Economic Corridor (CPEC).
Xi pushed for the creation of a supra-constitutional CPEC Authority that would freelance the management of the predatory infrastructure and power-generation projects under his direct command.
The proposal was rejected then, but last year it was again presented before the prime minister of the country – now Imran Khan. The reason given was timely completion of the projects.
This time the prime minister is a full-fledged puppet of the military establishment, and therefore it was easier than before to manipulate the law to fulfill Xi’s desire to take over the Planning Ministry of Pakistan, and in future the country itself.
I consider Pakistan’s Ministry of Planning, Development and Special Initiatives one of the most crucial state institutions, whose senior bureaucrats could implicitly scrutinize and resist Xi’s draconian CPEC scheme, as they had access to all of the secret documents on the agreement and were involved, directly and indirectly, in the decision-making process.
So long as the reins were under the control of civilian institutions led by representatives of the people and civil servants, thorough accountability of Xi’s master plan at least at some level and at some point in time – if not at once – was possible. Sidelining the civil institutions altogether would allow Xi to play on both sides of the board.
The agreement was so highly confidential that even the secretary of maritime affairs once refused to show it to the Senate Standing Committee on Finance. So one can imagine what an above-the-law sort of deal it must be.
The CPEC Authority was established in October last year using a presidential ordinance (without parliament’s approval) for four months and then was given another four-month extension. But Xi wants permanent control. And now that the establishment has its puppet in the Prime Minister’s House, it is putting all of its efforts into making the Authority more powerful and a permanent part of the constitution by pushing it through parliament.
Since the Authority has come into existence, its chairman has been a retired lieutenant-general.
Xi doesn’t want the Belt and Road Initiative or any of its components to be held accountable or face resistance. He knows that his Chinese Dream of indoctrination of a majority of free people of the world by 2050 will not be fulfilled if the people of the countries victimized by the BRI come to know about his strategy to destroy their futures and those of their future generations.
The truth is that he is burdening those countries in debt traps while they are already suffering from intense balance-of-payments crises. Xi will slowly poison Pakistan and other poor economies by creating extreme shortages of foreign-exchange reserves. In the end, these countries will have to accept the invasion of their political and economic systems by the Communist Party of China.
Four months ago, an inquiry into the workings of independent power producers (IPPs) took place in which two major coal-fired power-plant projects that were built under the CPEC – Huaneng Shandong Ruyi Energy and Port Qasim Electric Power Company – were found involved in corruption as they had misrepresented interest during construction to loot almost US$226 million from the dollar-strapped Pakistani economy.
The supra-constitutional CPEC Authority will act as the CPC’s subsidiary in Pakistan and will be responsible for conceiving, implementing, expanding, enforcing, controlling, regulating, coordinating, monitoring, evaluating and carrying out all activities related to the CPEC.
Furthermore, it will have the constitutional power to initiate an investigation and impose penalties against any public office holder (including the prime minister and president of Pakistan) or any other person who is directly or indirectly engaged in CPEC-related activities who willfully resist directions, instructions or specified orders of the CPEC Authority.
Even the prime minister’s powers will be limited to what is specified in the CPEC Authority Bill 2020. So he too will have to obey Xi’s commands.
According to a news report (that soon after its publication was mysteriously taken down), the chairman of the Authority – who, as noted above, is a retired lieutenant-general – will co-chair the Joint Cooperation Committee as the democratically elected planning minister will be removed from this position.
The JCC is the main decision-making body of CPEC. It has members from both Pakistan and China. But every year the Chinese officials at the JCC meetings browbeat the Pakistani officials as they review the making of Xi’s version of the East India Company.
As the world moves toward 2050, Xi’s plan of China’s ultimate control of the majority of the emerging-market economies is becoming crystal clear. At the cost of its sovereignty, territorial integrity and freedom of its people, the “selected” government of Pakistan is finding a permanent place in Xi’s basket.
Today he will attempt coup against the Ministry of Planning; next in his playbook could be its Defense Ministry, IT Ministry, Human Rights Ministry, Petroleum Ministry and many more.
#Pakistan - PCTB bans 100 books for being ‘against Two Nation Theory’
Punjab Curriculum and Textbook Board (PCTB) on Thursday banned 100 textbooks it found to be “against” the two-nation theory or deemed “unethical and illegal”.PCTB Managing Director Rai Manzoor Nasir addressing a press conference here said these books were being taught in renowned private educational institutions.
He said around 10,000 books were recovered from these institutes and they were also further investigating the matter.
He said as many as 30 committees had been constituted for inspection of around 10,000 books recovered from these institutes, including those published by Oxford, Cambridge, Link International Pakistan, Paragon Books and 31 other publishers.
30 committees to review 10,000 other books
Mr Nasir said some of the books had not printed even the correct date of birth of founder of Pakistan Quaid-e-Azam Muhammad Ali Jinnah and national poet Allama Muhammad Iqbal, while some others contained “blasphemous material” against some religious personalities and wrong maps of Pakistan. Similarly, there were 36 districts of Punjab, but some of these books were still mentioning 35 districts of the province, he regretted.
He said the government won’t tolerate this type of material being taught to Pakistani children and would ban such books. “We will conduct complete inspection of these books within six months and will not allow these books and material against Islam and Pakistan [to be taught],” he said.
A meeting of the Teaching Staff Association University of Engineering and Technology Lahore was held at the UET on Thursday.
The meeting was presided over by TSA President Dr Fahim Gohar Awan, who expressed concern over not conducting financial audit and not holding syndicate elections by the UET administration.
He deplored that the UET administration had been ignoring the association’s long-standing demand for a third-party audit of the UET for the last 10 years.
“We appreciate the historic initiative of Punjab governor to remove bureaucratic hurdles to university cases files,” he said.
He said the varsity management should also be instructed to remove the obstacles in the application process regarding the problems of teachers and other employees.
“Despite passage of several weeks, the applicants are not informed of the decisions that generate negativism among teachers and employees,” he said, demanding 10-day response time for such applications.
Treasurer Dr Mustafa Habib, Social Secretary Dr Tanveer Qasim and Executive Member Dr Muhammad Yousuf were also present. Secretary Dr Amir Akhlaq, Vice President Dr Tariq Nawaz, Dr Waseem attended the meeting online.
https://www.dawn.com/news/1570813
President Balochistan National Party (BNP-Mengal) Sardar Akhtar Mengal called on Chairman Pakistan People’s Party Bilawal Bhutto Zardar
In the meeting that lasted for two hours the two leaders discussed in depth the current political situation in the country. They also agreed to meet more often and continue the dialogue at the level of leadership as well as the level of delegates and representatives.
Sardar Akhtar Mengal was accompanied by MNA Agha Hassan Baloch central information secretary of the Party and BNP-M MPA Mir Amal Kalmati from Gawadur.
Later MNA Jam Karim Bijar also called on the Chairman PPP separately in Zardari House today.
https://www.ppp.org.pk/2020/07/25/president-balochistan-national-party-bnp-mengal-sardar-akhtar-mengal-called-on-chairman-pakistan-peoples-party-bilawal-bhutto-zardar/
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