The Financial Industry Regulatory Authority marked nineteen SAC Capital trades as suspicious and forwarded them to the SEC. They included drug companies such as Genentech Inc., ViroPharma Inc. and United Therapeutics Corporation. These trades were flagged because they were executed around major news announcements. In 2003, Genentech's rose 45% after it published the positive results of a drug study for Avastin. SAC made $158,500 by buying days before the news. Same situation occurred in 2007 with United Therapeutics. Just before the positive results of a drug trial were announced, SAC took a position in the stock. SAC made $2.3 million when the stock rose 38%. SAC shorted ViroPharma in 2009 - just before its drug trial was pronounced ineffective.
Other trades being investigated were made before merger and acquisition activity. Two of them are Hologic Inc.'s 2008 buyout of Third Wave Technologies Inc. and Johnson & Johnson's purchase of Couger Biotechnology.
Over the last ten years, SAC Capital has made $14 million on these trades. For enforcement purposes, only the trades in the last five years count. There is a five year statute of limitations on insider trading.
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For what shall it profit a man, if he shall gain the whole world, and lose his own soul?
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