Mike Madriaga 11:30 a.m., Sept. 23
Patent Agent, Brother Plead Guilty in Sequenom Scam
A former patent agent for biotech Sequenom, Aaron Scalia, and his Baltimore-based brother, Stephen Scalia, pleaded guilty today (Feb. 15) to passing inside information on Sequenom on two occasions. The Reader reported Dec. 8 that Brett Cohen of Baltimore and David Myers of Cleveland had leaded guilty to criminal charges of insider trading. They had secretly received information on two Sequenom events: 1. an upcoming purchase of Exact Sciences Corp., and 2. indication that the company would announce that so-called scientific information on a test for Down syndrome, which had driven Sequenom stock upward, could not be relied on. The two made oodles buying Exact stock and also buying put options that would pay off if Sequenom stock went down. (It plummeted 70% as the news got out.) In December, the U.S. Attorney's office did not reveal the name of the patent agent. Today it became known that Aaron Scalia was the patent agent who had inside information both on the acquisition and on the upcoming disastrous announcement.
Aaron Scalia was a patent agent in Sequenom's legal department. He passed on the insider information to his brother Stephen Scalia, who then in a roundabout way got the information to Cohen and Myers, who made fat profits on the two events. Myers and Cohen will be sentenced April 29. The Scalia brothers' guilty pleas are subject to final acceptance by U.S. District Court Judge Barry Ted Moskowitz.