Juno Therapeutics Inc. CEO Hans Bishop misled shareholders about a new cancer drug’s safety and then sold his stock before the company disclosed the drug’s toxic effects, according to a Jan. 3 shareholder suit.
Bishop and other executives at the biopharmaceutical company initially concealed and then blamed a companion drug for three patient deaths during Food and Drug Administration trials despite knowing the drug’s own severe neurotoxicity was to blame, according to the complaint, filed in the U.S. District Court for the District of Delaware. Bishop allegedly sold off his personal shares of Juno stock for more than $14.6 million in subsequent months, prior to making the drug’s fatal toxicity public.
When Juno November 2016 announced it was placing the drug trial on hold after two additional patient deaths, it incurred a one-day market cap loss of over $774.9 million and its stock dropped 24.5 percent, according to the complaint. The March 2017 announcement of the drug’s cancellation due to toxicity allegedly led to a four-day market cap loss of over $477 million and a stock drop of 17.8 percent.
Juno didn’t immediately respond to a request for comment and Bishop’s attorney couldn’t be identified.
The case is Carpenter v. Bishop, D. Del., No. 1:18-cv-00014, complaint filed 1/3/18.
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