Is Early Release of Study Data to Doctors Unfair?
by Hisham S. Ayoub, DMD
It is a common, and expected practice, to release study results and preliminary data of major studies to doctors and members of medical associations ahead of major conferences. But this has incited a collective cry from investors and analysts who claim that releasing data early is unfair to the investment community at large, according to an article in the Friday edition of the Wall Street Journal.
ImClone Systems (IMCL), Regeneron Pharmaceuticals (REGN), Genentech (DNA), and Onyx Pharmaceuticals (ONXX), all apparently were affected by the release of early results to doctors and members of the American Society of Clinical Oncology (ASCO) ahead of a major meeting to be held on June 1st.
ImClone, Regneron, and Genentech all are trading down since rumors arose claiming that preliminary data from key study results were less than positive, while Onyx has gained amid speculation that a key liver cancer drug showed favorable results.
Can the release of early results to doctors be construed as insider information?
It really shouldn’t matter! ASCO believes it serves its members, which include doctors and patient advocacy groups. The esteemed socieity does not care much about Wall Street, and rightly so.
Some investors did claim that they have acquired copies of the preliminary data ahead of the ASCO meeting through ‘third parties’. Obviously, these include member doctors.
So the problem should not lie squarely with ASCO, or other medical societies who are serving their members, it lies with Wall Street.
Regulators should keep on eye out for investment firms and hedge funds who claim to hire doctors as ‘analysts’, while the true purpose is to have insiders at the major medical meetings and conferences to acquire key preliminary data ahead of the general public.
But ASCO also has a role to play here; cancel a doctor’s membership if he/she is linked to any investment firm, group or hedge fund.
As for the doctors themselves; the primary concern should be to discuss data to aid in the future development of promising drugs to relieve the suffering of patients, not to act as an information medium for Wall Street fat cats.
Am I being too naive? Maybe, but being naive is being honest, and that should be on every doctor’s priority list.
Source: BioHealth Investor.com