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Moderna (MRNA) shares price us slightly up despite the investors’ concerns about stock sales. The stock has lost around $20 from its ATH of $80.
Moderna Inc (NASDAQ: MRNA) stock price is up 0.37% now. However, many in the financial sector are wondering if Moderna (MRNA) shares pulled a fast one on the market. These concerns come as Moderna (MRNA) stock prices rose in tandem with encouraging news concerning its phase 1 trials.
Sources say that the news regarding the m-RNA 1273 vaccine candidate didn’t offer conclusive evidence of its effectiveness.
Moderna (MRNA) Shares Up Despite Stock Sales by Management
Furthermore, eyebrows are being raised at the stock sales by shareholders. Moderna (MRNA) has been accused of hyping the results of its phase 1 trials. This is as Moderna’s (MRNA) Chief Financial Officer and Chief Medical Officer sold about $30 million worth of shares on May 18 and May 19.
Moderna’s announcement was on May 18. Moderna (MRNA) stock surged at the news of promising results of its phase 1 trials. At the time of filing this report, Moderna (MRNA) stock price was $61.73 (+0.37%).
These sales were automated. The automated plans known as 10b5-1 plans set conditions for future stock sales. These sales are out of the control of the management. They exist to avoid potential conflicts of interest. Management executives cannot be accused of manipulation due to insider knowledge.
However, Flagship Pioneering sold about 1 million shares on May 21 and 22. The average price for the stock was $69.47 million.
This gives everyone 69.5 million reasons why the stock sale could have been unethical. Flagship Pioneering is a Venture Capital firm owned by Moderna Co-Chairman Noubar Afeyan. The stock sale has sent shock waves throughout the investment community.
Flagship Sells Stock Independently
The part that has everyone concerned is the fact that the Flagship Pioneering Sales weren’t part of the 10b5-1 plans. Considering that Flagship Pioneering is listed as a Moderna insider.
Though stock sales using the plan are optional, many insiders prefer to do so due to ethical concerns. At the time of public disclosure via filing, Moderna (MRNA) stock had crashed from their May 18 peak. Noubar Afeyan is also the CEO of Flagship Pioneering. The Venture Capitalist Company owned about 51 million Moderna (MRNA) shares according to a March filing.
Afeyan in a recent interview defended the sales saying:
“It was based on our looking at the data and concluding that we needed to have our own resources going into develop this vaccine and not simply wait for government grants.”
These problematic sales have raised questions of unethical sales of stocks. It also comes at a time when critics are questioning the “unscientific” nature of the data presented at the May 18 press briefing.
Scientists have questioned how a press release with so little data could point to conclusive evidence. Moderna (MRNA) and the National Institutes of Allergy and Infectious Diseases (NIAID) have defended it. The real situation surrounding the results will be revealed as soon as the results of the phase 1 trials come out.
Moderna is entering into its phase 2 trials with more than 600 participants. This raises questions about m-RNA 1273 being a dud. However, the only thing appearing to save the vaccine candidate is the validation from NIAID.