US medical group may sue banks for embargo breach
BOSTON, March 4
BOSTON, March 4 (Reuters) - The American Academy of Neurology said on Tuesday it may try to take legal action against JP Morgan, Merrill Lynch and other investment banks that released embargoed data ahead of its annual meeting next month.
"We are examining our legal options," said Angela Babb, a spokeswoman for the group, which represents more than 21,000 neurologists and neuroscientists. "The Academy takes its embargo policy very seriously."
Merrill Lynch analyst Paul Choi put out a report on Monday which revealed embargoed information about Baxter International Inc's (BAX.N) experimental Alzheimer's disease treatment Gammagard IGIV. On Tuesday JP Morgan analyst Michael Weinstein followed suit.
And Corey Davis, an analyst at Natixis Bleichroeder, released a report on Tuesday about data from a study of Biogen Idec Inc (BIIB.O) and Elan Corp's ELN.N ELN.I multiple sclerosis drug Tysabri.
A spokesman for JP Morgan said the company had retracted its report. Natixis also recalled his report. Merrill Lynch declined to comment.
The flap is the latest in a series involving medical associations, which typically release summaries, or abstracts, of clinical trial data online ahead of their annual meetings. Anyone accessing the data must agree not to publish it ahead of an agreed period.
"The embargo situation is an honor system," said Murray Sagsveen, general counsel for the American Academy of Neurology, or AAN. "What this person did is to dishonor the embargo system," he said, referring to Choi.
Sagsveen said he is exploring options available to the Academy to ensure it does not happen again, though right now those are not clear.
"Because of the actions of that one person who started the process, there is a cascade effect that could take down the entire embargo system," he said. "We may have to rethink the whole way we do things."
Sagsveen noted violations in the past by pharmaceuticals companies and media companies, but said this is the first time financial companies have broken the Academy's embargoes.
(Reporting by Toni Clarke, editing by Richard Chang)