George Haywood, 69, of Washington, D.C., pleaded guilty to one count of insider trading based on non-public information he received from a person in the management of Neurotrope concerning a grant from NIH relating to medicine for Alzheimer’s disease.
Haywood pleaded guilty in the U.S. District Court for the District of Columbia. The Honorable Reggie B. Walton scheduled sentencing for Nov. 9, 2022.
According to court documents, Haywood is a District of Columbia-based financial services professional who managed investments on behalf of his family and friends. On Jan. 22, 2020, , Neurotrope, a clinical-stage biopharmaceutical company (now known as Synaptogenix) announced that it was being awarded a $2.7 million grant from the National Institutes of Health following positive clinical trial results for medicine for the treatment of Alzheimer’s disease. This resulted in an increase of its stock price to a high of $3.85 per share. Later that day, Haywood spoke to a representative of Neurotrope by telephone. The person offered to share material non-public information relating to Neurotrope with Haywood so long as Haywood agreed not to execute or attempt to execute any stock trades with the information. Haywood agreed to receive material non-public information, subject to these conditions. The representative then informed Haywood that Neurotrope would issue a registered direct offering later that day and invited him to participate in it. The offering was expected to cause Neurotrope’s stock price to fall.
Immediately after receiving that information, Haywood sold or attempted to sell shares of Neurotrope worth over $328,701.16, despite having agreed to receive the information and not to execute or attempt to execute any stock trade with it. Based on the daily closing price of $1.42 per share, Haywood avoided a loss of at least $179,297.18 on the sale of those shares between the time he received the material non-public information and the time the registered direct offering was announced to the public.
JEFFREY NEWMAN, A FORMER PROSECUTOR, IS A WHISTLEBLOWER LAWYER WITH THE FIRM NEWMAN & SHAPIRO, AND HE CAN BE REACHED AT JNEWMAN@NEWMANSHAPIRO.COM OR AT 978-880-4758