The Bay Area exec lost a trial

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A Bay Area biotech executive committed insider trading when he used internal information to bet on a rival company, a San Francisco jury decided Friday.
The trade netted Panuwat a $107,066 profit, which the SEC complaint referred to as “ill-gotten gains.” Gurbir Grewal, director of enforcement at the federal agency, celebrated the civil jury’s verdict.
“This was insider trading, pure and simple,” he wrote in a statement Friday.
The accounting researchers who coined the phrase called the practice “undocumented and widespread” in a 2020 paper.
Panuwat had never traded Incyte stock before and didn’t tell anyone else at Medivation about the trades, according to the SEC’s complaint.
In its original complaint, the commission requested that Panuwat pay a fine and be barred from serving as a director or officer of a publicly traded company.
Hear of anything happening at a Bay Area tech company?
Contact tech reporter Stephen Council securely at or on Signal at 628-204-5452.


A San Francisco jury found on Friday that a biotech executive from the Bay Area had engaged in insider trading when he used confidential information to place a wager on a competitor company.

The case focuses on transactions made by former Medivation executive Matthew Panuwat in 2016 after he discovered that his employer, a pharmaceutical company specializing in cancer treatments with headquarters in San Francisco, had been approached by Pfizer, the largest pharmaceutical company in the world, about a $14 billion acquisition offer. According to a Securities and Exchange Commission complaint, Panuwat used his work computer “within minutes” of learning about the bid. He was betting that shares of the competing oncology research firm Incyte would increase once the news spread.

Panuwat made a $107,066 profit on the trade, which the SEC complaint described as “ill-gotten gains.”. The federal agency’s director of enforcement, Gurbir Grewal, praised the civil jury’s decision. He said in a statement on Friday, “This was insider trading, pure and simple.”.

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According to Bloomberg’s Matt Levine, the case marks a historic attempt by the SEC to crack down on “shadow trading,” which is the practice of using proprietary information to trade the stock of another business. The accounting researchers who coined the phrase called the practice “undocumented and widespread” in a 2020 paper. After the federal jury’s decision on Friday, legal and banking experts raised the alarm, stating that businesses and investors might need to implement new rules in order to save face with the SEC.

Based on the SEC’s complaint, Panuwat had never traded Incyte stock before and had not disclosed the trades to anyone else at Medivation. His agreement to Medivation’s anti-insider trading policy, which expressly forbade purchasing or disposing of “the securities of another publicly traded company,” was made when he first began working for the company, the complaint stated. According to his LinkedIn profile, Panuwat left Medivation in January 2017 and is currently the chief business officer of ORIC Pharmaceuticals, which is based in South San Francisco.

Less than a day was spent in deliberation by the jury, according to the SEC. The commission demanded in its initial complaint that Panuwat forfeit his right to hold any position as an officer or director of a publicly traded company and pay a fine. Judge will decide what punishments he receives.

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SFGATE requested comment from Panuwat’s attorneys, but they did not provide it.

If you know of any developments at a Bay Area tech company, please get in touch with tech reporter Stephen Council via Signal at 628-204-5452 or stephen . council@sfgate . com.

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