Fraud Charges For Former Execs Of $21B Pharma Corp. In Greater Morristown

MORRIS PLAINS, NJ — Two former leaders of a $21 billion biopharmaceutical company based in Morris Plains were charged Wednesday with fraud. The former company's chief financial officer and head of corporate communications split more than $200,000 after profiting off inside information about a breast-cancer drug's effectiveness, federal authorities said.

The complaint names former CFO Usama Malike and former head of corporate communications Lauren S. Wood. While the complaint does not name the company for which they worked, records show both served the roles for now-defunct biotechnology company Immunomedics.

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Gilead Sciences acquired Immunomedics in October 2020 for $21 billion. Immunomedics was headquartered in Morris Plains and operated from 1982 until last year's acquisition.

Immunomedics announced April 6, 2020, that sacituzumab govitecan — its experimental breast-cancer drug — had proven effective in premarket trials. The antibody-based drug was designed to treat certain patients who had significantly limited treatment options beyond chemotherapy.

As CFO, Malik was among the first — if not few — employees who received non-public information about the drug. In December 2019, Malik wired Wood about $65,000, which she used on company shares with a total value of $72,695, authorities said. Malik also provided the info to several relatives, the complaint said.

At the time, financial experts had downgraded Immunomedics's stocks. After the April 2020 announcement, the company's shares on Nasdaq rose from $9.40 to $18.74.

Wood sold her shares, realizing gross profits of $213,618 and returning $65,000 to Malik, authorities said.

Malik and Wood were each charged with securities fraud, which carries penalties of up to 20 years in prison and a fine of up to $5 million.

Both were scheduled to appear in court Thursday afternoon — Malik before U.S. Magistrate Judge Zia Faruqui in Washington, D.C., and Wood before U.S. Magistrate Judge John F. Anderson in Alexandria, Virginia.

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