Rep. Chris Collins (R-NY) was charged this morning with insider trading, after having allegedly dumped his stock in a Big Pharma company after becoming aware of a drug trial failure before that same drug trial failure was publicly reported.
But that's not Collins' only apparent legal and/or ethical lapse where his investment in the company was concerned: In 2017, Collins was also busted pushing legislation that would have made his Big Pharma investment far more lucrative if passed.
According to the New York Times, "On June 27, 2017, the day after... Collins made his last trades selling Innate Immunotherapeutic stock, news of its failed drug test became public and the stock plummeted by more than 90 percent."
Collins appears to have known about the trial failure in advance, and to have ordered the dumping of his stock within minutes. More from the Times:
Mr. Collins, 68, was attending the Congressional Picnic at the White House in June 2017 when he received a private email from the company’s chief executive that a test for an experimental drug had failed, the indictment said. Fifteen minutes later, the congressman, who sat on the firm’s board of directors and was one of its largest shareholders, called his son, Cameron Collins, who sold their shares in the company, avoiding losses of more than $570,000, the indictment said.
Yet months before the Congressional Picnic, the Washington Examiner noted Collins was pushing the 21st Century Cures Act, which would have hugely benefited the company.
Collins was also pushing legislation to slash the 340B prescription drug discount program, which costs taxpayers nothing but which pharmaceutical companies- including the one he invested it, apparently- oppose, believing it dents their already very high profits. From the Examiner:
Collins also played a major role in shaping the 21st Century Cures Act. According to various news reports, Collins inserted a provision into the late-2016 legislation that allowed a fast-track approval process for investigational drugs. This provision boosted Innate's stock by helping bring Innate's sole product, a Multiple Sclerosis drug called MIS416, to market more quickly.
Collins just happened to have bought up about a million dollars in Innate stock in August 2016, as the 21st Century Cures Act wended its way through Congress.
It's with this brief history in mind that we need to consider Collins' current efforts on the drug discount program called 340B. Medicaid covers prescription drugs, which provides a pipeline of taxpayer money for drug companies, and 340B in effect requires drugmakers to offer a discount on some drugs to certain hospitals and clinics that largely serve poor populations dependent on Medicaid.
Drugmakers dislike the program because it eats into profits. They point out that the discounts, rather than being passed along to patients, often just pad the bottom line of the clinics or hospitals. The lobbying fight over reforming, preserving, or killing 340B is fierce. And Collins has weighed into it.
"Rep. Chris Collins (R-NY), who is working on a 340B reform bill he expects to release in the next month or so," reported Inside Health Policy, an industry journal May 4, "views the drug discount program as a driver of rising drug costs and said he is telling the administration one way to tackle drug prices is to reform the program."
Collins made this argument at a summit sponsored by the Alliace for Integrity and Reform of 340B, a coalition of drugmakers and industry lobby groups.
So, not only does Collins appear to have engaged in insider trading. He also appears to have been using his position as congressman to legislate higher profits for the company he was invested in.
It appears to be too late for Collins' name to be removed from the November election ballot, so most likely, this is another seat that Democrats will win.
It is therefore another good reminder of the importance of the GOP consistently nominating ethically upright individuals. Not only do voters not like the swamp; they know it's hard for someone to represent them from jail.