A California-based biotechnology company faces a federal probe after it allegedly misrepresented its involvement with the Trump administration’s Operation Warp Speed program to develop Wuhan coronavirus (Covid-19) vaccines and treatments.
Vaxart indicated in an Oct. 14 Securities and Exchange Commission (SEC) filing that back in July it was served with a grand jury subpoena from the U.S. District Court for the Northern District of California. Both the SEC and federal prosecutors are in charge of the investigation.
At issue is a press release by Vaxart from back in June that claimed the company had been “selected for the U.S. Government’s Operation Warp Speed.” The news sent the company’s stock prices soaring from approximately $3 per share all the way up to $17 per share.
The hedge fund group Armistice Capital, which partially controlled Vaxart, sold its shares after the increase, resulting in profits of more than $200 million, according to its SEC filings.
This was made possible by amendments that Vaxart made to its warrant agreements just a few weeks prior, allowing Armistice to sell almost all of its stock once the price went through the roof.
Approximately one month later, the Department of Health and Human Services (HHS), which oversees Operation Warp Speed, told The New York Times that it did not, in fact, enter into any kind of funding agreement or negotiations with Vaxart. When pressed, Armistice could not be reached for comment.
According to the HHS, Vaxart was never chosen by Operation Warp Speed to receive any kind of research funding, and only had limited involvement. Vaxart’s vaccine, which is actually an oral tablet, only had minimal involvement in preliminary studies, the HHS now claims.
Vaxart doubles down, insists it was chosen by Operation Warp Speed
Responding to CNN Business, which petitioned Vaxart for comment, the company’s “non-human primate challenge study was organized by Operation Warp Speed, as stated in the June 26, 2020 company press release.”
“The statements made in that press release are accurate and any allegation to the contrary is baseless,” the company added, explaining that it “has voluntarily provided documents requested by the SEC and is cooperating with this informal inquiry.”
As we also reported, Vaxart’s top company executives have become filthy rich from the firm’s apparently deceptive announcement, which insinuates that Vaxart continues to play a role in Operation Warp Speed.
Vaxart’s shareholders have apparently sued the company on multiple occasions, alleging that they were misled by the company’s misrepresentations concerning Operation Warp Speed. They likewise accused the Vaxart board of inflating the company’s stock prices for illicit gain.
In its SEC filing, Vaxart addressed these lawsuits by indicating that it is in the process of trying to get two of them dismissed, while another class-action suit is still in process.
Also on Oct. 14, Vaxart announced that oral dosages of its Wuhan coronavirus (Covid-19) vaccine tablets are supposedly producing positive results. Even so, the company’s stock price was down 3.5 percent that day to just $6.
Vaxart is still planning to go through with human clinical trials, despite the federal investigation. These trials began just one day before the company’s disclosure announcement.
According to reports, the company is looking to enroll 48 healthy volunteers, aged 18-54, by early November. Participants will receive either a low dose or high dose of the vaccine, known as VXA-CoV2-1, both on the first and 29th day of the study.
“We are very pleased to be one of the few companies selected by Operation Warp Speed, and that ours is the only oral vaccine being evaluated,” company CEO Andrei Floroiu stated prior to the news about the federal probe.
More related news about the Wuhan coronavirus (Covid-19) can be found at Pandemic.news.
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