On August 28, 2024, the Securities and Exchange Commission reached a settlement with California resident Maggie Chen for allegedly trading in MyoKardia, Inc. securities in advance of the company’s announcement of positive clinical trial results for Mavacamten, a heart medication, in May 2020.
According to the SEC’s order, in 2020, Chen was working as a Statistician Consultant for MyoKardia to support the company’s clinical drug trials. As a consultant, Chen was allegedly subject to a confidential disclosure agreement that prohibited her from disclosing confidential information obtained during the trials or using the information for her personal benefit. Chen allegedly learned of Mavacamten’s positive results on May 6, 2020, and, over the next two days, purchased 1,007 shares of MyoKardia stock based on the material nonpublic information, in breach of a duty owned to MyoKardia and its shareholders. Chen also allegedly shared the tip with a relative who also purchased shares of MyoKardia stock. Following MyoKardia’s announcement of the Phase 3 Mavacamten drug trial, the stock price increased by 58 percent enabling Chen and her relative to generate alleged profits of $33,845 and $23,857, respectively.
According to the SEC, Chen’s actions violated Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the SEC’s allegations, Chen consented to the entry of a cease-and-desist order against her. She also agreed to disgorge $33,845, pay $3,329 in prejudgment interest, and pay a civil money penalty of $57,702.