On Tuesday, a French doctor was arrested and charged for insider trading by US Prosecutors. In 2007-08, the doctor is supposed to have leaked the classified information on a clinical drug trial to a hedge fund who avoided losses of $30 million by selling early.
According to the US officials investigating the charges, Yves Benhamou, a doctor who is working at Pitié-Salpetriere hospital in Paris, shared the negative findings on a clinical test of Albuferon, an experimental drug to treat Hepatitis C, which was being developed by Human Genome Science with the manager of a hedge fund. By doing so, he broke the securities law.
He tipped the hedge fund manager after death of a patient in a clinical drug trial.
The hedge fund, Frontpoint Partners, avoided a loss of $30 million by selling the shares of Human Genome Sciences Inc. immediately before the news of negative drug trial broke in the media. The name of the hedge fund was not taken in the court documents. Frontpoint Partners is owned by Morgan Stanely, who is in process to dissolute the firm.
