Icon bosses sell €10m shares before US 'warning'
Sunday December 13 2009
ICON Plc founders Ronan Lambe and John Climax, as well as chief executive Peter Gray, were blessed with spectacular timing as they sold close to €10m worth of shares in the firm shortly before its shares tanked after a "warning" from the US Food and Drug Administration (FDA).
Giant institutional investor Fidelity was less fortunate, as its FMR company bought 200,000 shares in November. It now holds 8.3 per cent of Icon.
"Icon had had no prior communications from the FDA in relation to the matter. Hence the letter from the FDA that Icon received late on the evening of December 2 was unexpected," said the firm. All share trades need pre-approval, it added. There's no suggestion that this was anything other than fortunate timing on the part of the sellers. The €900m valued Nasdaq-listed company provides specialised research for drug companies.
Dr Lambe filed to sell 600,000 American Depositary Shares at a price of $22.58 on November 20, in a transaction worth €9.2m. The filings also showed that he exercised and sold 12,000 options netting a further €125,000. Goldman Sachs handled the trades.
This was Dr Lambe's largest share sale for two years, although he also sold 70,000 shares during the autumn.
Chief executive Peter Gray sold €1.12m worth of stock, offloading 68,000 shares at a price of $24.26 apiece. He also exercised 20,000 options on November 9. John Climax exercised and sold 20,000 ADS in what was described as a "cashless transaction" on November 9.
Two weeks after Dr Lambe's final trade, on December 4, Icon shocked the market by revealing it had received a warning from the FDA about its management of two studies between 2004 and 2006. The FDA warning related to Icon research into an antibiotic to treat skin infections.
Subsequent to the warning, shares tanked, falling 6 per cent in early trading. And in the last six weeks, shares in the company have fallen nearly 20 per cent .
Icon implemented a "blackout" period for any employee share-option exercises and for any share sales by employees.
- Nick Webb
Sunday Independent
