Novartis AG (NYSE:NVS) Fires Leading Scientists Over Claims Of Gene Therapy Data Manipulation

Fiona - August 15, 2019

The gene therapy division of Novartis AG (NYSE:NVS) will be missing the services of two of the company’s top scientists. Brian Kaspar and Allan Kaspar are the exiting scientists. Novartis decided to fire them after it learnt that they were involved in manipulation of gene therapy data.

The Kaspars scandal

The company’s CEO, Vas Narasimhan, in a press conference confirmed that the Kaspars were involved in internal data falsification. He added that such cases damaged their reputation and performance, and the company was not ready to tolerate it. The two brothers were focusing on gene therapy Zolgensma when the company learnt about data manipulation activities. Zolgensma is a gene replacement therapy for pediatric patients struggling with spinal muscular atrophy (SMA). This product won approval from the Food and Drug Administration in May. However, the company did not disclose information regarding data manipulation to the regulator until June 28.

Novartis has questions to answer

It raises a lot of questions as to why the company did not inform the regulator about the scandal right away. The company ran to its defense claiming it had to wait for its internal investigation arm to give its report. This explanation doesn’t add up considering that Novartis already learnt much and even started plans to fire the two brothers. The plan to fire the Kaspars started a month before informing the regulator.

Brian and Allan worked with AveXis taking up the chief scientific officer vice president roles respectively. AveXis biotechnology focuses on the development of working solutions for rare neurological genetic disorders. Novartis bought it previous year at $8.7 billion. The company’s co-founder, Brian Kaspar, generated $383 million from the sale of his stock holdings in AveXis. Efforts by news reporters to get the two brothers to comment on the issue haven’t generated any results. They refuse to speak out on the matter for reasons best known to them.

Lawmakers won’t let Novartis get off the hook quite easily. They want the company to provide further details regarding internal investigation.

Fiona

Fiona

Fiona is a finance graduate and an expert in analyzing market trends.

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