Chicago-based medical professor settles with SEC to resolve insider trading charges

On December 20, 2021, the Securities and Exchange Commission entered a settlement with Daniel V.T. Catenacci to resolve insider trading charges filed in connection with trades he placed in connection with Five Prime Therapeutics, Inc., a California-based biotechnology company, before the company announced positive drug trial results with cancer drug Bemarituzamab in November of 2020.  According to the SEC complaint, Catenacci, a Chicago-based medical school professor, allegedly obtained the material nonpublic information about the positive drug trial results in his role as lead clinical investigator for the company’s drug trial.   Based on this confidential information, Catenacci allegedly purchased 8,743 shares of Five Prime securities and sold it all on the day after the positive drug trial results were announced, realizing $134,142 in illegal profits after the shares’ value increased by 300 percent.  

According to the judgment that was issued by the US District Court for the Northern District of Illinois on December 27, 2021, Catenacci agreed to be permanently enjoined from further violations of  Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder.  The court will determine whether a civil penalty is appropriate and, if so,  the amount of the penalty at a later date.

On December 20, 2021, the US Attorney’s Office for the Northern District of Illinois announced that parallel criminal charges were filed against Catenacci in connection with his Five Prime securities trades.

Judgment | SEC press Release | SEC Complaint | USAO News Release

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