Feds ar­rest pop­u­lar Twit­ter day trad­er over al­leged 'pump and dump' scheme

A day trad­er has been ar­rest­ed and charged for op­er­at­ing a “pump and dump” scheme — on Twit­ter.

Steven Gal­lagher, through his Twit­ter alias@AlexDe­large6553 (named af­ter the fic­tion­al char­ac­ter in “A Clock­work Or­ange”), al­leged­ly tout­ed and en­cour­aged his 70,000 fol­low­ers to pur­chase shares in En­zolyt­ics, a Texas-based biotech de­vel­op­ing mon­o­clon­al an­ti­bod­ies and trad­ing over the counter, among oth­er pen­ny stocks.

As part of the en­force­ment, the SEC has se­cured a court or­der to freeze up to $6.9 mil­lion worth of Gal­lagher’s as­sets, in­clud­ing stocks cur­rent­ly held in bro­ker­age ac­counts owned by him­self or his wife. An in­ves­ti­ga­tion is on­go­ing.

Gal­lagher was ar­rest­ed in the North­ern Dis­trict of Ohio on Tues­day af­ter­noon. As of Wednes­day morn­ing, his Twit­ter ac­count is no longer ac­tive.

“As al­leged, Steven Gal­lagher brought old-school boil­er room tac­tics to the Twit­ter age, and op­er­at­ed a so­cial me­dia pump-and-dump scam that de­fraud­ed or­di­nary in­vestors, all so that he could make over $1 mil­lion in prof­its,” said Dami­an Williams, the Unit­ed States At­tor­ney for the South­ern Dis­trict of New York. “To­day’s ar­rest of Gal­lagher demon­strates that this Of­fice and our law en­force­ment part­ners will be vig­i­lant as se­cu­ri­ties fraud schemes move on­to Twit­ter and oth­er forms of so­cial me­dia.”

Ac­cord­ing to an un­sealed com­plaint fea­tur­ing a de­po­si­tion by Kingston Moy, a spe­cial agent with the Unit­ed States De­part­ment of Home­land Se­cu­ri­ty, Home­land Se­cu­ri­ty In­ves­ti­ga­tions, Gal­lagher lured oth­er re­tail in­vestors to pur­chase cer­tain stocks through false and mis­lead­ing state­ments in tweets and Twit­ter di­rect mes­sages, as well as ma­nip­u­la­tive trad­ing.

En­zolyt­ics, one of the cas­es Moy cit­ed, fit in­to that broad­er pat­tern.

As Moy told it, Gal­lagher was al­leged to have bought his first 3 mil­lion shares of $EN­ZC at $0.0007 per share, on or about Ju­ly 14, 2020. He then kept build­ing a stake un­til Sept. 16, at which point he held about 7 mil­lion shares. Mean­while, he made sure to let his Twit­ter fol­low­ers know about the in­vest­ment.

On Sep 16, he sold 3 mil­lion shares. Not that his Twit­ter fol­low­ers would no­tice: That same day, he sent a se­ries of en­thu­si­as­tic tweets re­mind­ing them of his in­vest­ment in the biotech, flag­ging an up­com­ing merg­er and en­cour­ag­ing oth­ers to “Load!! this!”

One of his mul­ti­ple tweets that day read: “$en­zc Will be #1 on my list do [sic] to this ma­jor med­ical news!! the buy­ers in the morn­ing will be many!! Alot [sic] less than now!! just satin [sic].”

The tweets kept com­ing over the next few days, when he tweet­ed en­dorse­ments like: “$en­zc still my #1 great run;” “$en­zc must own #1;” “$en­zc stock of the year!! great start;” and, “This is gonna be a life chang­er. I heard someome [sic] bought 70 mil­lion shares to­day!! Some­one knows what this merg­er means!!! I do!!”

On Sept. 22, he fol­lowed up with tweets call­ing En­zolyt­ics a “long hold” for him, high on his list and say­ing it’s “buy­ing time,” when in fact he had al­ready sold al­most all of his shares.

Bro­ker­age records and SEC in­for­ma­tion sug­gests that Gal­lagher pock­et­ed around $160,000 in prof­its from his En­zolyt­ics trad­ing. At least two un­named vic­tims, how­ev­er, claimed to have lost thou­sands of dol­lars af­ter fol­low­ing Gal­lagher’s ad­vice.

Scoop: Boehringer qui­et­ly shut­ters a PhII for one of its top drugs — now un­der re­view

Boehringer Ingelheim has quietly shut down a small Phase II study for one of its lead drugs.

The private pharma player confirmed to Endpoints News that it had shuttered a study testing spesolimab as a therapy for Crohn’s patients suffering from bowel obstructions.

A spokesperson for the company tells Endpoints:

Taking into consideration the current therapeutic landscape and ongoing clinical development programs, Boehringer Ingelheim decided to discontinue our program in Crohn’s disease. It is important to note that this decision is not based on any safety findings in the clinical trials.

Endpoints Premium

Premium subscription required

Unlock this article along with other benefits by subscribing to one of our paid plans.

Alex­ion puts €65M for­ward to strength­en its po­si­tion on the Emer­ald Isle

Ireland has been on a roll in 2022, with several large pharma companies announcing multimillion-euro projects. Now AstraZeneca’s rare disease outfit Alexion is looking to get in on the action.

Alexion on Friday announced a €65 million ($68.8 million) investment in new and enhanced capabilities across two sites in the country, including at College Park in the Dublin suburb of Blanchardstown and the Monksland Industrial Park in the central Irish town of Athlone, according to the Industrial Development Agency of Ireland.

State bat­tles over mifepri­s­tone ac­cess could tie the FDA to any post-Roe cross­roads

As more than a dozen states are now readying so-called “trigger” laws to kick into effect immediate abortion bans following the overturning of Roe v. Wade on Friday, these laws, in the works for more than a decade in some states, will likely kick off even more legal battles as states seek to restrict the use of prescription drug-based abortions.

Since Friday’s SCOTUS opinion to overturn Americans’ constitutional right to an abortion after almost 50 years, reproductive rights lawyers at Planned Parenthood and other organizations have already challenged these trigger laws in Utah and Louisiana. According to the Guttmacher Institute, other states with trigger laws that could take effect include Arkansas, Idaho, Kentucky, Mississippi, Missouri, North Dakota, Oklahoma, South Dakota, Tennessee, Texas, and Wyoming.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 144,400+ biopharma pros reading Endpoints daily — and it's free.

Deborah Dunsire, Lundbeck CEO

Af­ter a 5-year re­peat PhI­II so­journ, Lund­beck and Ot­su­ka say they're fi­nal­ly ready to pur­sue OK to use Rex­ul­ti against Alzheimer's ag­i­ta­tion

Five years after Lundbeck and their longtime collaborators at Otsuka turned up a mixed set of Phase III data for Rexulti as a treatment for Alzheimer’s dementia-related agitation, they’ve come through with a new pivotal trial success they believe will finally put them on the road to an approval at the FDA. And if they’re right, some analysts believe they’re a short step away from adding more than $500 million in annual sales for the drug, already approved in depression and schizophrenia.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 144,400+ biopharma pros reading Endpoints daily — and it's free.

A Mer­ck part­ner is sucked in­to the fi­nan­cial quag­mire as key lender calls in a note

Another biotech standing on shaky financial legs has fallen victim to the bears.

Merck partner 4D Pharma has reported that a key lender, Oxford Finance, shoved the UK company into administration after calling in a $14 million loan they couldn’t immediately make good on. Trading in their stock was halted with a market cap that had fallen to a mere £30 million.

“Despite the very difficult prevailing market conditions,” 4D reported on Friday, the biotech had been making progress on finding some new financing and turned to Oxford with an alternative late on Thursday and then again Friday morning.

Members of the G7 from left to right: Prime Minister of Italy Mario Draghi, European Commission President Ursula von der Leyen, President Joe Biden, German Chancellor Olaf Scholz, British Prime Minister Boris Johnson, Canadian Prime Minister Justin Trudeau, Prime Minister of Japan Fumio Kishida, French President Emmanuel Macron and European Council President Charles Michel (AP Photo/Susan Walsh)

Biden and G7 na­tions of­fer funds for vac­cine and med­ical prod­uct man­u­fac­tur­ing project in Sene­gal

Amidst recently broader vaccine manufacturing initiatives from the EU and European companies, the G7 summit in the mountains of Bavaria has brought about some positive news for closing vaccine and medical product manufacturing gaps around the globe.

According to a statement from the White House, the G7 leaders have formally launched the partnership for global infrastructure, PGII. The effort will aim to mobilize hundreds of billions of dollars to deliver infrastructure projects in several sectors including the medical and pharmaceutical manufacturing space.

Fed­er­al judge de­nies Bris­tol My­er­s' at­tempt to avoid Cel­gene share­hold­er law­suit

Some Celgene shareholders aren’t happy with how Bristol Myers Squibb’s takeover went down.

On Friday, a New York federal judge ruled that they have a case against the pharma giant, denying a request to dismiss allegations that it purposely slow-rolled Breyanzi’s approval to avoid paying out $6.4 billion in contingent value rights (CVR).

When Bristol Myers put down $74 billion to scoop up Celgene back in 2019, liso-cel — the CAR-T lymphoma treatment now marketed as Breyanzi — was supposedly one of the centerpieces of the deal. After going back and forth on negotiations for about six months, BMS put $6.4 billion into a CVR agreement that required an FDA approval for Zeposia, Breyanzi and Abecma, each by an established date.

Chris Anzalone, Arrowhead CEO

Take­da, Ar­row­head spot­light da­ta from small tri­al show­ing RNAi works in a rare liv­er con­di­tion

Almost two years after Takeda wagered $300 million cash to partner with Arrowhead on an RNAi therapy for a rare disease, the companies are spelling out Phase II data that they believe put them one step closer to their big dreams.

In a small, open label study involving only 16 patients who had liver disease associated with alpha-1 antitrypsin deficiency (AATD), Arrowhead’s candidate — fazirsiran, previously ARO-AAT — spurred substantial reductions in accumulated mutant AAT protein in the liver, a hallmark of the condition. Investigators also tracked improvements in symptoms, with seven out of 12 who received the high, 200 mg dose seeing regression of liver fibrosis.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 144,400+ biopharma pros reading Endpoints daily — and it's free.

Faheem Hasnain at Endpoints' #BIO22 panel (J.T. MacMillan Photography for Endpoints News)

Bat­tle-test­ed biotech ex­ecs turn to an ex­pe­ri­enced in­dus­try god­fa­ther for some board­room guid­ance

Little Sling Therapeutics out of Ann Arbor, MI may be just a few days out of the starting gate from the announcement of its $35 million launch round, but execs are positioning themselves within clear sight of a key clinical finish line. And they’re revving up with an experienced player to help guide them on the way.

The biotech is putting out word this morning that Faheem Hasnain has agreed to godfather the drug developer as chairman of the board, adding a measured dash of seasoning at a point when most biotechs are still struggling with the embryo stage.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 144,400+ biopharma pros reading Endpoints daily — and it's free.