US COVID-19 'Pill Vaccine' Developer Under Prosecutor Investigation for Spreading False Information

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[Image source=Baeksat homepage/https://vaxart.com]

[Asia Economy Reporter Hyunwoo Lee] Vaxart, a U.S. pharmaceutical company known for developing an oral pill form of the novel coronavirus disease (COVID-19) vaccine, which had attracted attention, is reportedly under investigation by the U.S. federal prosecutors for allegations including spreading false information. Previously, Vaxart promoted that its vaccine was receiving support from the Donald Trump administration's 'Operation Warp Speed,' causing its stock price to surge more than fivefold, with executives and hedge funds who were early investors making significant profits. However, the U.S. Department of Health and Human Services (HHS) stated that the company did not receive such support, leading to lawsuits filed by investors.

According to foreign media such as CNN on the 18th (local time), Vaxart is reportedly being investigated by the U.S. federal prosecutors and the U.S. Securities and Exchange Commission (SEC) for allegations including spreading false information and insider trading. The SEC revealed that in June, Vaxart announced its vaccine would receive support from the Trump administration's Operation Warp Speed, and Vaxart's stock price, which had been around $2 to $3, surged to $16.97 on July 14. However, HHS clarified that Vaxart's vaccine had not entered clinical trials and was not a recipient of Operation Warp Speed support, causing the stock price to plummet again, closing at $6.08 on the 16th. According to HHS, Vaxart is a company that received preliminary research funding for primates, which is part of the Operation Warp Speed funds.

During the stock price surge, executives and hedge funds holding shares in the company reportedly made capital gains amounting to $200 million (approximately 228.3 billion KRW), prompting investigations by the SEC and U.S. federal prosecutors. Numerous investors have filed class-action lawsuits, claiming significant losses due to the dissemination of false information and insider trading. Vaxart stated regarding the lawsuits, "Two of the class-action lawsuits have been dismissed, while others are still ongoing."

Previously, Vaxart had been developing an oral pill form of the COVID-19 vaccine, unlike other companies' injectable forms, and began Phase 1 clinical trials on the 13th. On the 14th, it announced effectiveness in oral administration experiments on hamsters, raising high expectations. Oral pill vaccines are much easier to store and transport compared to injectable vaccines that require freezing or refrigeration, and are expected to significantly reduce vaccine costs.

This content was produced with the assistance of AI translation services.