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Insider trading charges dropped against ex-Academia Sinica head

2018/02/21 21:16:33

Former Academia Sinica President Wong Chi-huey (翁啟惠)/CNA file photo

Taipei, Feb. 21 (CNA) Shilin District Prosecutors Office on Wednesday decided not to proceed with an insider trading case against former Academia Sinica President Wong Chi-huey (翁啟惠) and 11 others, due to a lack of evidence.

Wong had been investigated over allegations of insider trading relating to the development of a cancer drug by Taiwanese startup biotech company OBI Pharma.

The controversy erupted following Wong's endorsement of a new cancer drug produced by OBI Pharma, even though the company later announced on Feb. 21, 2016 that the drug had failed second and third-round clinical trials, news that sent the company's stock price plummeting.

The main focus has been the fact that Wong's daughter is a major shareholder in the company.

It also emerged that Wong sold 10,000 shares in OBI Pharma on Feb. 18, 2016, on behalf of his daughter, shortly before the trial results were made public and the company's share price crashed.

After the first investigation, prosecutors decided in 2016 to drop the insider trading charges against Wong on the grounds that the shares were sold on the recommendation of an equity dealer and Wong did not participate in the clinical trials involving the drug.

The case was submitted to the Prosecutors' Office of Taiwan High Court for review before being sent back to Shilin District Prosecutors Office for further investigation.

Prosecutors on Wednesday wrapped up the latest investigation, upholding the previous decision that Wong's sale of the OBI Pharma shares was based on the advice of a stockbroker and therefore the insider trading charges against him should be dropped.

Prosecutors also decided not to indict 11 senior executives at the company who sold shares in the firm before the announcement of the trial results due to a lack of evidence.

Shilin District Prosecutors Office continues to investigate corruption charges against Wong and OBI Pharma Chairman Michael Chang (張念慈), because Chang allegedly bribed Wong with shares to obtain Academia Sinica research on synthetic oligosaccharides technology in 2011.

(By Hsiao Po-wen and Evelyn Kao)