Re: “Science By Press Release”

I have written skeptical comments about Moderna’s press release announcing success for their SARS-CoV-2 vaccine, but a listener letter from Episode 617 of This Week In Virology has backed me off a little from that position. I quote the letter in full here:

Jon writes:

Dear professors,

For background, I’m a mathematical physicist by training, but I invest in small biotechs as a hobby.    I remember first hearing about mRNA vaccines on a TWIV circa 2012 when I was driving to the Buffalo airport, and surprising my brother-in-law (a prof at MD Anderson in infectious disease) that something like that could work.

However, I have a bone to pick with you guys about your coverage of Moderna’s decision to issue its press release.  For reasons not widely appreciated in academia, brief press releases of so-called “top line data” are a standard and necessary practice, not something that Moderna has schemed up.

Unlike academic researchers, publicly traded companies are ethically and legally bound to consider at what point withholding trial results becomes unfair to either new or existing shareholders, especially when issuing new shares, as Moderna is now doing.   (The $483M the government is chipping in sounds like a lot, until you consider that they are already ramping up in a hurry to manufacture 1B doses/year, all of them still subject to clinical risk.)  Furthermore, as you know, a full release may jeopardize the investigator’s ability to publish the results or present them at academic conferences. (Note that this study was conducted in collaboration with the National Institute of Allergy and Infectious Disease).

The relevant legal issues are explained in the security and exchange commission (SEC) exceptions to the embargo policy of the annual American Society of Clinical Oncology annual conference website.  The conference website states:

After the abstract is submitted to and prior to the abstract information being publicly released in conjunction with an ASCO Meeting, the author, coauthors, sponsor of the research, journalists, and others must not

• make the information public, or provide it to others who may make it public (such as news media),
• publish or present the information or provide it to others who may publish or present it,
• use the information for trading in the securities of any issuer, or provide it to others who may use it for securities trading purposes.

with an exception for minimal “top line” data releases required to fulfill SEC regulations.

SEC [securities and exchange commission] Exceptions

A publicly traded company may determine that it is legally required to disclose certain data or other information from a confidential abstract in advance of the public release date to satisfy requirements of the U.S. Securities and Exchange Commission or a corresponding regulatory body in a country where the company’s stock is traded (collectively, “SEC”). This need typically arises when there is a substantial likelihood that the information would be considered by a reasonable investor in the company to significantly alter the total mix of information made available to the investor.

In general, the abstract is still eligible for inclusion in the ASCO Meeting provided that the company submits to ASCO, in advance of the release, a letter signed by the company’s legal counsel that contains the abstract title, indicates the format/nature of the public disclosure, and advises that (a) public disclosure of the information is necessary for the company to comply with applicable securities laws, and (b) the information disclosed is the minimum necessary for such compliance…..

The emphasis was added by me.  So professors shouldn’t blame the corporate world for the brevity of press releases, unless they’re willing to forgo giving presentations! Science and Nature are also well-known sticklers as well.

More vitally, in the case of COVID-19 we are no longer waiting for phase 3 data to be published before we build factories and ramp up production.  It is therefore is entirely appropriate from an economic viewpoint that investors and others get an early peek at the interim data to decide where to allocate capital.  (I also worry that hackers will get at the data for insider trading if it isn’t released publicly ASAP.)

I should also point out that the company gave a fascinating and still-available 1-hour public webcast (slides + audio, slides only)  to discuss the release, which included a Q&A from big investment companies.   Later that day there was another webcast from an investor conference, again publicly available.  Don’t be put off by the websites asking for an email, just put “small investor” in the “occupation” box (and a fake email address if you like) and they won’t bother you.  (I presume their lawyers might have required them to collect email addresses in case they accidentally made a gross misrepresentation, because I’ve never gotten spam from such webcasts in the companies I follow.) 

Sincerely,

Jon