Senate Minority Leader Chuck Schumer just exposed Donald Trump’s choice for to head the Department Health and Human Services for using his House of Representatives seat to make money insider trading the stock market for biotech company Zimmer Biomet, by introducing his own company friendly legislation, after his broker bought their shares.
Representative Price is a poster child for all of the reasons House Republicans tried to devastate the Congressional Ethics Office earlier this year, before reversing themselves when the public caught them trying to steal money in the middle of the night. Price was also cited in an independent report for partaking in an insider’s stock sale from a foreign biotech company, along with a House Republican colleague, to help a company that desperately needs regulatory clout. As CNN reports, Rep. Tom Price (R-GA.) even received a healthy donation to his Political Action Committee after the insider trading maneuver was executed:
Rep. Tom Price last year purchased shares in a medical device manufacturer days before introducing legislation that would have directly benefited the company, raising new ethics concerns for President-elect Donald Trump’s nominee for Health and Human Services secretary. Less than a week after the transaction, the Georgia Republican congressman introduced the HIP Act, legislation that would have delayed until 2018 a Centers for Medicare and Medicaid Services (CMS) regulation that industry analysts warned would significantly hurt Zimmer Biomet financially once fully implemented. Zimmer Biomet, one of the world’s leading manufacturers of knee and hip implants, was one of two companies that would have been hit the hardest by the new CMS regulation that directly impacts the payments for such procedures, according to press reports and congressional sources. After Price offered his bill to provide Zimmer Biomet and other companies relief from the CMS regulation, the company’s political action committee donated to the congressman’s reelection campaign, records show.
Democratic Senator Schumer believes strongly that an ethics investigation is needed urgently before any hearings can be called on this Trump Cabinet pick, and perhaps charges as well according to TPM:
“If he knew about it, it could very well be a violation of the law,” Schumer told CNN, calling for an investigation. “Now they say there’s a broker, it’s kind of strange that this broker would pick this stock totally independently of him introducing legislation that’s so narrow and specific to this company. This is a very narrow, specific company that dealt with implants—hip and knee—and the legislation specifically affects implants,” he told CNN. “He puts it in a week after he buys the stock? That cries out for an investigation.”
Rep. Tom Price (R-GA.) is the man that Republicans expect to oversee the devastation of America’s healthcare sector and repeal of Obamacare, but it turns out that insider trading might the least worrisome of his transactions. One Australian biotech company sold Price and Republican Rep. Chris Collins a million dollars worth of stock at a discount, because both sat on key committees poised to legislate matters that affected the company. That stock has already gone up 400% in value, but it wasn’t just any stock you could buy on an exchange. Price was offered what Kaiser Health News calls a “sweetheart deal” on the privately placed shares in a company whose entire business strategy hinges on American regulatory approval.
A review of corporate documents raises a more unusual aspect of the deal. Innate Immuno is a foreign company which, in documents and presentations, is explicit about a business strategy targeting the U.S. market, where the amount that can be charged for a new drug is generally far higher than in other countries. Innate Immuno has hinged its strategy on winning a preliminary green light for a new multiple sclerosis drug, known as MIS416, from the HHS’s Food and Drug Administration. It says in its private placement offering documents that money raised in the U.S. will help it finance the FDA approval process, which can take years.
Owning the privately floated shares, bought at a special insider’s discount in an industry which your official position you oversee is a horrendously open conflict of interest for any lawmaker to take, but Representative Price didn’t stop there. According to KHN, he’s a very active investor:
Price’s Innate Immuno stake is one of more than 40 companies he identifies as potential conflicts with the HHS job, including stock in Pfizer, Eli Lilly and Bristol Myers Squibb.
There you have it, yet another Trump Cabinet choice who makes a policy of using his insider position for self-enrichment. Representative Price is shamelessly conflicted and has sold his interests to represent the American people off to the very highest bidder, so he can pocket a few nickels- and on just the worst deal, he’s not even the only House Republican to buy into a foreign company that needs their appearance of assistance more than anything else in their business plan. Price’s response is to promise that he won’t do it again and to sell his shares in Innate Immuno within 90-days, which would, of course, give him sufficient time to help them further before selling.
Republican Congressman Tom Price can never be confirmed by the Senate to a position of high authority having such a highly verified track record of blatant self-enrichment through his elected office.
Grant Stern is an Editor-At-Large for OccupyDemocrats and published author. His new Meet the Candidates 2020 book series is distributed by Simon and Schuster. He's also mortgage broker, community activist and radio personality in Miami, Florida., as well as the producer of the Dworkin Report podcast. Grant is also an occasional contributor to Raw Story, Alternet, and the DC Report, and a senior advisor to the Democratic Coalition