Clo­vis CEO Patrick Ma­haffy set­tles up on SEC charges of ly­ing about the ro­ci da­ta — and it won’t cost much

For 4 crit­i­cal months in 2015, Clo­vis $CLVS and its ex­ec­u­tives led by CEO Patrick Ma­haffy main­tained that their can­cer drug ro­ci had per­formed beau­ti­ful­ly in clin­i­cal tri­als, with a 60% ef­fi­ca­cy rate that blew the an­a­lysts away. That’s what they told in­vestors, rais­ing $298 mil­lion with a fat stock price in Ju­ly of 2015.

And, ac­cord­ing to the SEC, Ma­haffy knew it was a lie. He and for­mer CFO Er­le Mast were told ear­li­er that the ef­fi­ca­cy had shrunk con­sid­er­ably, but that wasn’t their pub­lic line. And when they dis­closed the truth in No­vem­ber, their share price plunged 70%.

To­day, though, they’re get­ting away with a slap on the wrist.

With­out any ad­mis­sion of guilt, the SEC is let­ting Ma­haffy — still CEO of Clo­vis — off with a $250,000 penal­ty. Mast is pay­ing $100,000 penal­ty, and dis­gorg­ing prin­ci­pal and in­ter­est he made sell­ing the com­pa­ny stock dur­ing that pe­ri­od to­tal­ing $454,145.

Clo­vis, or its in­vestors, are pay­ing $20 mil­lion to set­tle the claims.

Last year Ma­haffy was pro­vid­ed a com­pen­sa­tion pack­age worth $8.7 mil­lion. In 2015, when he was ac­cused of mis­lead­ing in­vestors, he took home a $5.7 mil­lion pack­age.

He’s nev­er re­spond­ed to re­quests for com­ments.

It was ap­par­ent years ago that Clo­vis had been gild­ing the lily on their da­ta.

Set­backs hap­pen in biotech. But some of the ex­perts who watched this drug say this was not the usu­al kind of clin­i­cal re­ver­sal that can eas­i­ly oc­cur in a risky field like drug de­vel­op­ment. Clo­vis ex­ecs had been pur­pose­ly mis­lead­ing in­vestors with a false por­trait of the da­ta, they claimed. 

“I feel that the ef­fi­ca­cy da­ta have, con­sis­tent­ly and re­peat­ed­ly, over many years, been mis­rep­re­sent­ed,” R&D ex­pert Kapil Dhin­gra told me months lat­er af­ter he wrote an analy­sis of the da­ta for An­nals of On­col­o­gy. “This is not sim­ply a case of gray zones, this is black and white un­true pre­sen­ta­tion of the da­ta. And it is not just a mi­nor mis­rep­re­sen­ta­tion (such as pho­to­shop­ping a west­ern blot im­age etc that can get a ba­sic sci­en­tist in trou­ble); the true ef­fi­ca­cy is about half of what they rep­re­sent­ed.”

Im­age: Patrick Ma­haffy, by Kathryn Scott Osler GET­TY

The DCT-OS: A Tech­nol­o­gy-first Op­er­at­ing Sys­tem - En­abling Clin­i­cal Tri­als

As technology-enabled clinical research becomes the new normal, an integrated decentralized clinical trial operating system can ensure quality, deliver consistency and improve the patient experience.

The increasing availability of COVID-19 vaccines has many of us looking forward to a time when everyday things return to a state of normal. Schools and teachers are returning to classrooms, offices and small businesses are reopening, and there’s a palpable sense of optimism that the often-awkward adjustments we’ve all made personally and professionally in the last year are behind us, never to return. In the world of clinical research, however, some pandemic-necessitated adjustments are proving to be more than emergency stopgap measures to ensure trial continuity — and numerous decentralized clinical trial (DCT) tools and methodologies employed within the last year are likely here to stay as part of biopharma’s new normal.

As­traZeneca caps PD-L1/CT­LA-4/chemo com­bo come­back with OS win. Is treme­li­mum­ab fi­nal­ly ready for ap­proval?

AstraZeneca’s closely-watched POSEIDON study continues to be the rare bright spot in its push for an in-house PD-L1/CTLA-4 combo.

Combining Imfinzi and tremelimumab with physicians’ choice of chemotherapy helped patients with stage IV non-small cell lung cancer live longer, the company reported — marking the first time the still-experimental tremelimumab has demonstrated an OS benefit.

For AstraZeneca and CEO Pascal Soriot, the positive readout — which is devoid of numbers — offers much-needed validation for the big bet they made on Imfinzi plus tremelimumab, after the PD-L1/CTLA-4 regimen failed multiple trials in head and neck cancer as well as lung cancer.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Ron DePinho (file photo)

A 'fly­over' biotech launch­es in Texas with four Ron De­Pin­ho-found­ed com­pa­nies un­der its belt

In his 13 years at Genzyme, Michael Wyzga noticed something about East Coast drugmakers. Execs would often jet from Boston or New York to San Francisco to find more assets, and completely miss the work being done in flyover states, like Texas or Wisconsin.

“If it doesn’t come out of MGH or MIT or Harvard, probably not that interesting,” he said of the mindset.

Now, he and some well-known industry players are looking to change that, and they’ve reeled in just over $38 million to do it.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Onno van de Stolpe, Galapagos CEO (Thierry Roge/Belga Mag/AFP via Getty Images)

Gala­pa­gos chops in­to their pipeline, drop­ping core fields and re­or­ga­niz­ing R&D as the BD team hunts for some­thing 'trans­for­ma­tive'

Just 5 months after Gilead gutted its rich partnership with Galapagos following a bitter setback at the FDA, the Belgian biotech is hunkering down and chopping the pipeline in an effort to conserve cash while their BD team pursues a mission to find a “transformative” deal for the company.

The filgotinib disaster didn’t warrant a mention as Galapagos laid out its Darwinian restructuring plans. Forced to make choices, the company is ditching its IPF molecule ’1205, while moving ahead with a Phase II IPF study for its chitinase inhibitor ’4617.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Stéphane Bancel, Getty

Mod­er­na CEO brush­es off US sup­port for IP waiv­er, eyes more than $19B in Covid-19 vac­cine sales in 2021

Moderna is definitively more concerned with keeping pace with Pfizer in the race to vaccinate the world against Covid-19 than it is with Wednesday’s decision from the Biden administration to back an intellectual property waiver that aims to increase vaccine supplies worldwide.

In its first quarter earnings call on Thursday, Moderna CEO Stéphane Bancel shrugged off any suggestion that the newly US-backed intellectual property waiver would impact his company’s vaccine or bottom line. Still, the company’s stock price fell by about 9% in early morning trading.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

'Chang­ing the whole game of drug dis­cov­ery': Leg­endary R&D vet Roger Perl­mut­ter leaps back in­to work as a biotech CEO

Roger Perlmutter needs no introduction to anyone remotely involved in biopharma. As the R&D chief first at Amgen and then Merck, he’s built a stellar reputation and a prolific career steering new drugs toward the market for everything from cancer to infectious diseases.

But for years, he’s also held a less known title: science partner at The Column Group, where he’s regularly consulted about the various ideas the VCs had for new startups.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Nick Leschly at Endpoints' JPM20 Breakfast Panel (Jeff Rumans for Endpoints News)

2sev­en­ty: Nick Leschly brings a trio of top ex­ecs with him on top-speed flight from the blue­bird nest

After serving more than a decade as bluebird bio’s chief bluebird, Nick Leschly is switching it up.

At some point this year, Leschly will officially become the CEO of 2seventy — the new company that will house bluebird’s oncology business while Andrew Obenshain, the current president for severe genetic diseases, will take over as CEO to oversee the rare disease pipeline remaining at bluebird.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Cynthia Butitta (L) and Joe Jimenez

Is that an­oth­er IPO in the mak­ing? Ex-No­var­tis CEO Joe Jimenez and a lead Kite play­er take up new posts at an off-the-shelf ri­val to 2 pi­o­neer­ing drugs

Right on the heels of taking on a $160 million crossover round in a likely leap to Nasdaq, Century Therapeutics CEO Lalo Flores is now pushing ahead with the high-profile ex-Novartis chief Joe Jimenez as chairman.

Jimenez’s greatest fame at Novartis was earned for one of its weakest products, as their pioneering personalized CAR-T Kymriah won the honors for the first such drug to make it to the market. Now a host of players, including Century, are barreling in behind the frontrunners with allogeneic rivals that can be created for off-the-shelf use.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Ad­comm splits slight­ly in fa­vor of FDA ap­prov­ing Chemo­Cen­tryx’s rare dis­ease drug

The FDA’s Arthritis Advisory Committee on Thursday voted 10 for and 8 against the approval of ChemoCentryx’s $CCXI investigational drug avacopan as a treatment for adults with a rare and serious disease known as anti-neutrophil cytoplasmic autoantibody (ANCA)-vasculitis.

The vote on whether the FDA should approve the drug was preceded by a split vote of 9 to 9 on whether the efficacy data support approval, and 10 to 8 that the safety profile of avacopan is adequate enough to support approval.