On Monday, when the pharmaceutical giant Pfizer had made the announcement of the positive data about its coronavirus vaccine, the CEO of the drug maker, Albert Bourla, had also filed to sell millions of dollars of his company’s stock.
After Pfizer and European drug company BioNTech said that results from its early data suggested that the vaccine could be more than 90 per cent effective, there was a significant spike in the shares of the company.
The transactions of his shares were a part of a regular plan of schedule picked up by Bourla to sell some of the shares he owned at Pfizer in a periodic manner.
According to a filing with the Securities and Exchange Commission, 132,508 Pfizer shares at a price of $41.94 were sold by Bourla. That amounts to a total of almost $5.6 million.
The sale transaction happened because the shares of Pfizer crossed a predetermined price that had been planned and authorized by Bourla on August 19, said a company spokeswoman in an emailed statement to the media.
On the question of whether Pfizer and Bourla had considered cancelling the sale of the shares because of the perception that Bourla could be inadvertently encashing on the good news about the coronavCovid-19 vaccine, the spokeswoman said that “these are predetermined plans managed through a third-party stock administrator.”
As part of a prearranged plan, shares of the company belonging to another Pfizer officer, executive vice president Sally Susman, were also sold on Monday. The transaction generated more than $1.8 million as Susman sold 43,662 shares at the same $41.94 price that Bourla sold at.
Stocks are sold by many executives at predetermined intervals in order to further diversify their portfolios. But such sales can be postponed by them so that it does not appear that such executives were capitalizing on one-off events that can spruce up shares of their companies.
He had come to know of the trial’s results on Sunday – a day before they were made public, Bouria said in a television interview.
A surge of almost 8 per cent was recorded on Monday in the share price of Pfizer while the shares remained flat on Tuesday. There has been even more surge in the share price of BioNTech on the new with a 15 per cent spike on Monday and another 8 per cent on Tuesday.
Pfizer’s stock fell more than 1% Wednesday.
This stock sale event at Pfizer follows up on a similar event at Moderna, a biotech also working on a Covid-19 vaccine, about a month ago when its executives also sold their shares after the company announced promising results of trials form the vaccine.
Even though there were criticisms of Moderna of overhyping the vaccine trial results, the company nonetheless generated an amount of $1.3 billion through a stock sale soon after the announcement of the results of the vaccine trials.
Tens of millions of dollars worth of Moderna shares were sold by executives at the company before the rally fizzled out a week later.
(Adapted from CNN.com)