Juan Roman, a former Senior Director of Market Access at Acceleron Pharma Inc., has been charged by the Securities and Exchange Commission (SEC) with insider trading. The allegations pertain to his misuse of confidential information regarding the company’s drug development milestones, leading to significant illegal profits.

The Allegations: The SEC’s complaint, filed in federal court in Boston, accuses Roman of engaging in insider trading on two separate occasions between 2019 and 2020. Leveraging his executive position, Roman allegedly accessed nonpublic information about Acceleron’s drug developments and used this knowledge to conduct illicit trades.

First Incident: December 6, 2019 On December 6, 2019, during a securities trading blackout period, Roman is alleged to have traded Acceleron stock and options. This trading occurred just before the company announced favorable news regarding its application to the FDA for approval to market and sell Reblozyl, an anemia drug, for a specific use. These trades purportedly resulted in a profit of $1,637 for Roman.

Second Incident: January 23-24, 2020 In a similar pattern, on January 23 and 24, 2020, Roman is accused of trading Acceleron options during another blackout period. This activity took place ahead of the public release of positive clinical trial results for Sotatercept, a drug under development for treating pulmonary arterial hypertension. The SEC claims that these trades netted Roman approximately $96,115 in profits.

SEC’s Position: Joseph G. Sansone, Chief of the SEC’s Market Abuse Unit, emphasized the agency’s commitment to upholding market integrity. He stated, “Trading on material nonpublic information is not just unfair; it’s illegal. The SEC will continue to pursue those who undermine the principles of market integrity.”

Resolution and Penalty: To settle the charges, Roman has agreed to a settlement that includes paying over $200,000 in penalties. This resolution underscores the SEC’s dedication to imposing substantial consequences on individuals who exploit privileged information for personal gain.

Implications for the Industry: This case serves as a stark reminder to professionals in the pharmaceutical and biopharmaceutical sectors about the critical importance of adhering to securities laws and maintaining ethical standards. The misuse of confidential information not only breaches legal obligations but also erodes public trust in the industry.

Conclusion: The allegations against Juan Roman highlight the severe repercussions of insider trading and the necessity for strict compliance with ethical and legal standards within corporate roles. The SEC’s actions in this case reinforce its commitment to preserving market integrity and deterring illicit activities.