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Twitter ‘drama’ produces drubbing for Medivir

pharmafile | December 11, 2013 | News story | Medical Communications, Sales and Marketing Medivir, Twitter, digital, nasdaq 

A NASDAQ disciplinary committee has found Medivir guilty of breaching its rules after data from a trial was posted on Twitter before its formal release to investors.

The case has been ongoing for much of the year and dates back to the leaking of a Phase II study for one of the Nordic pharma firm’s products on 4 March.

The information was spread when a participant at a research conference in the US took a photograph of material from Medivir and published it on Twitter.

As a result the share price of Medivir rose, whereupon the NASDAQ Stockholm exchange decided to stop trading in the company’s shares.

Trading resumed the same day after publication of the official press release by Medivir with information about the actual results of the study, although this took the firm three hours to publish after the tweet was sent.

The disciplinary committee of NASDAQ OMX Stockholm – the Northern European stock exchange – found that the information comprised interim data from the first part of a Phase II study of one of Medivir’s products.

These data did not display any ‘sensational results’ and in the opinion of the committee, Medivir could be deemed to have reason for making an initial assessment that the data did not comprise price-sensitive information.

But the committee added: “However, since confidential information was leaked and spread through such channels as Twitter, a level of drama and interest was created in the information, which did not necessarily have any rational connection based on the factual content of the information. The nature in which the information was spread is deemed to have impacted the share price.”

Medivir should have released the data itself as soon as it discovered the Twitter conversation, the committee said. It added that publishing these data three hours later was ‘unacceptable’.

It also found that the company’s press releases “do not always meet the requirements” of its regulations. For all of these reasons, Medivir was found in breach of three regulations governing operations on trading venues and order to pay a fine of SEK 384,000 ($58,720) – equal to twice the company’s annual fee to the NASDAQ Stockholm exchange.

This appears a particularly harsh penalty for the infectious diseases specialist, and although a minor financial fee in relative terms (it made $85 million in 2012),  this is a broader warning to pharma about the quick-fire nature of Twitter and protection of its data.

After all it was not Medivir who tweeted the information but someone in the audience. However, as it was the firm’s conference and it delayed posting its own official press release to counteract the ‘drama’ of a tweet, the company remains culpable.

Ben Adams

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