A federal jury Monday convicted the previous chief govt for native biotechnology firm CytoDyn, together with the top of the corporate’s regulatory agent to the U.S. Meals and Drug Administration, for a scheme to defraud traders.
In accordance with courtroom paperwork, CytoDyn raised about $300 million from traders after the defendants conspired to mislead them. Greater than $22 million of that went to Kazem Kazempour’s firm, Amarex Medical Analysis. Moreover, Nader Pourhassan, former chief govt of CytoDyn, acquired $4.4 million from his sale of CytoDyn inventory, and Kazempour acquired greater than $340,000, in line with the Division of Justice.
Pourhassan and Kazempour engaged in a conspiracy to defraud traders by false and deceptive representations and materials omissions in regards to the growth of CytoDyn’s leronlimab drug, in line with the Division of Justice. (Leronlimab is a monoclonal antibody investigational drug being created as a possible therapy for HIV.)
The indictment alleged they lied to traders in regards to the timeline and standing of CytoDyn’s regulatory submissions to the FDA to artificially inflate and preserve the worth of the corporate’s inventory and entice new traders; additionally they bought their private shares of CytoDyn’s inventory.
A previous assertion from a CytoDyn spokesman mentioned Pourhassan was terminated Jan. 24, 2022, and faraway from the board of administrators.
Pourhassan was CytoDyn’s president and chief govt on the time of the fraud. He got here underneath hearth in his closing months within the place after the FDA was compelled to difficulty an announcement in regards to the firm’s testing of leronlimab to deal with COVID-19. CytoDyn had used outcomes from a small subgroup of take a look at contributors to recommend there was a “mortality benefit in certain patients” who took the drug, in line with the FDA’s assertion.
“None of these analyses met statistical significance when using established and reliable analytical methods that correct for multiple comparisons,” the assertion learn.
Kazempour’s Amarex managed CytoDyn’s scientific trials and served as its regulatory agent in interactions with the FDA. Kazempour additionally served on the corporate’s Disclosure Committee, which was accountable for reviewing and approving CytoDyn’s periodic filings with the Securities and Alternate Fee, in line with the Division of Justice.