A former vice-president of operations at bio-pharmaceutical company Kamada was indicted on Monday for insider trading and violating financial reporting requirements. The charges refer to a deal signed with healthcare company Baxter International in 2010.
- Kamada shares slide after it raises $51.6 million in U.S. IPO
- Kamada raises $51.6 million in Nasdaq IPO
- Caesarstone, Kamada sell shares as Wall Street soars
- Kamada workers walk off production lines
The indictment before the Tel Aviv District Court charged Avi Baziz, 49, with using information available to him by virtue of his position to purchase shares in Kamada ahead of the public announcement of the Baxter agreement. Baziz served as Kamada’s chief project officer and reported directly to the company’s CEO.
In August 2010, Kamada reported to the Tel Aviv Stock Exchange that it had reached a deal granting Baxter the right to distribute Kamada's intravenous AAT drug in the United States, Canada, Australia and New Zealand and to use Kamada’s patents. In return, Baxter agreed to supply Kamada with the raw materials for producing the drug.
Prosecutors said that the Baxter deal was estimated to be worth millions in revenues for Kamada and was expected to significantly affect the company’s share price at the time.
According to the indictment, Baziz purchased 1,000 shares in Kamada for NIS 19,960 ahead of the public announcement and sold the shares in January 2011 for NIS 26,890 – a profit of NIS 6,930. He also tipped off his friend Avihay Ratzon, sending him a text message that said, “Buy now, don't say I didn't tell you. I can't provide details, you understand later in the week.” Ratzon and his brother proceeded to buy shares of Kamada.
The day Kamada publicly announced the deal with Baxter its shares jumped up 16.24% on the TASE.
The indictment also stated that Baziz failed to report the changes in his holdings of his own company's shares as senior corporate officers are required to do by the Securities Law.