This is what I wrote on the morning of March 4, 2010 with InterMune shares surging:
U.S. drug regulators kept the long knives in their scabbards when reviewing InterMune's lung drug pirfenidone, raising the odds for the drug's approval and sending the company's shares sharply higher Friday...
FDA staff, in a review posted to the agency's web site, questioned whether one positive and one negative study of pirfenidone in patients idiopathic pulmonary fibrosis (IPF) is enough to prove "substantial evidence" of efficacy enough to support the drug's approval.
Yet the FDA review didn't raise any new concerns with pirfenidone's efficacy or safety unanticipated by investors and acknowledged that IPF is a fatal disease with no effective treatments.The FDA generally makes briefing documents, including the agency's internal drug review, available to the drug sponsor two or three weeks before the scheduled advisory panel. Likewise, the FDA also provides advanced copies of briefing documents to the outside experts invited to participate on the panel. Obviously, these FDA materials contain valuable and stock-moving information, particularly in the hands of a trader who could appreciate how investors would react to a relatively benign FDA review of pirfenidone. SAC hasn't been charged with any wrongdoing in connection with its InterMune trades so we don't know if the FBI and SEC are investigating if, for example, an SAC trader might have paid an expert sitting on the pirfenidone panel for early access to the FDA's briefing documents. The SEC has charged Mathew Martoma, a portfolio manager with an SAC-affiliated hedge fund, with obtaining illegal insider information about the Elan and Johnson & Johnson Alzheimer's drug bapineuzumab from a doctor involved in a clinical trial. We also don't know exactly when during the first quarter 2010 SAC purchased its InterMune stake. The fund's quarterly SEC filings only list stock holdings at the end of each quarter.