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Nov 11, 2020

Pfizer CEO joins pharma executives selling stock in COVID rally

Vaccine-fueled stock rally subsides

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Pfizer Inc. Chief Executive Officer Albert Bourla pocketed about US$5.6 million after selling shares, the latest executive to reap the rewards of insider stock transactions amid a vaccine-fueled rally for some pharmaceutical companies.

Bourla disposed of more than 130,000 shares on Monday, according to a filing with the U.S. Securities and Exchange Commission. Pfizer executive Sally Susman also offloaded about US$1.8 million in stock. The sales came as Pfizer’s shares soared after the company reported results from its experimental vaccine with partner BioNTech SE that were hailed by the top U.S. infectious-disease specialist as “extraordinary.”

Both executives’ sales were done under prearranged 10b5-1 trading plans, which let people schedule sales in advance at certain times or prices, absolving themselves from accusations of insider trading. Public-company executives typically receive a considerable share of their compensation in the form of stock, and the vast majority periodically sell part of their holdings.

A Pfizer spokeswoman said the sales were part of the executives’ personal financial planning. Bourla authorized the sale in August and Susman in November 2019, provided the stock reached a certain price.

Still, some governance watchdogs criticize executive sales generally, and trading plans in particular, asking why bosses would dispose of stock if they think the price might be higher in the future. Moderna Inc., for example, has received scrutiny as executives sold large amounts of stock throughout the spring and the summer.

Moderna’s CEO Stephane Bancel has sold more than half a million shares this year, but the value of his stake has swelled as the stock has rallied. Moderna is also slated to release its own late-stage COVID-19 vaccine data sometime this month that could push prices higher.

Moderna didn’t immediately respond to emailed requests seeking comment.