Former NJ Pharma Exec, His Girlfriend Charged With Insider Trading

NEW JERSEY — A man who once worked as the chief financial officer for a New Jersey-based pharmaceutical company was indicted last week for sharing insider information with his girlfriend about a new breast cancer drug about to hit the market.

Usama Malik, 47, who now lives in Washington, D.C., was indicted May 10 on three charges: Insider trading, securities fraud and conspiracy to commit securities fraud.

The pharmaceutical company was not named by federal prosecutors in the indictment, however its headquarters are in Morris Plains.

The indictment was announced by U.S. Attorney Philip Sellinger.

Federal prosecutors say that from 2018 through October 2020, Malik was the CFO of a New Jersey-based biopharmaceutical company listed on the NASDAQ Stock Exchange.

On April 6, 2020, the company publicly announced for the first time that its breast cancer drug –an antibody-based drug designed to treat certain breast cancer patients who had very limited treatment options beyond chemotherapy – had proven effective in pre-market clinical trials.

In October 2020, another biopharmaceutical company acquired the company for which Malik worked for approximately $21 billion.

Malik was among the first, and one of the few, employees who received the material non-public information about the breast cancer drug before the public announcement.

Within minutes of obtaining that information, Malik passed it along to Lauren Wood, 33, his girlfriend at the time. Wood lived with Malik at the time and she used to work for the same pharmaceutical company he worked for.

Within hours of receiving the insider information from Malik, Wood placed an order for approximately 7,000 shares of the company’s stock, despite the fact that during the same time period the company’s stock was downgraded by financial experts.

After the company announced that its cancer drug had proven effective in pre-market clinical trials, its stock price increased. After selling her shares, Wood more than doubled her investment, realizing gross profits of $213,618.

Wood was also charged with securities fraud. At this time, she has not been indicted.

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