Monday, November 29, 1999

SEC probes generic drug-maker Mylan: Report

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New York, June 16 (PTI) US market regulator SEC is probing whether pharma entity Mylan Inc revealed confidential information about its earnings to some investors, helping them purchase the firm''s shares before a rally, says a report. The Wall Street Journal has reported that the SEC has contacted many investment banks whose analysts cover generic drug-maker Mylan, asking about a meeting the company hosted last September with those analysts and a group of investors. "The Securities and Exchange Commission (SEC) is investigating whether generic-drug maker Mylan Inc disclosed confidential information about its coming earnings to a group of handpicked investors, allowing them to snap up the shares before a big rally," the daily said, quoting people familiar with the matter. Going by the regulations, selective disclosure of material information by listed companies is illegal, even though the entities are free to meet investors as they choose. The report noted that if firms provide information that could be expected to move their share price, it must be disseminated publicly. The Wall Street Journal said that roughly a dozen Wall Street analysts working at firms including UBS AG and Goldman Sachs, attended the Mylan meeting on September 9 and there was no public broadcast. Attributing to Mylan, the daily said that SEC has asked for information related to the meeting. "We provided (the information) and are confident the communications made during the conference were entirely appropriate," a Mylan spokesman was quoted as saying. As per SEC rules, even confirmation of existing estimates projections can potentially convey market-sensitive information, especially if they are made near the end of a reporting period. The daily pointed out that at the time of Mylan''s meeting, there were only three weeks left in its third quarter. "When third-quarter earnings were released October 29, the company beat consensus estimates and its shares rose five per cent," the report said.

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