GOP Rep. Chris Collins Loses Millions After Stock He Pitched To Colleagues Plummets To Nearly Worthless

The Buffalo News reports:

Shares of the Australian biotech firm that Rep. Chris Collins touted to other members of the House and to leading Buffalo-area figures collapsed in value Tuesday after the company announced its once-promising new drug for multiple sclerosis had failed in clinical trials.

Innate Immunotherapeutics stock, valued as high as $1.77 a share in January, quickly fell to 5 cents a share at the close of trading on the Australian Stock Exchange. Analysts in Australia said prospects for the company’s future appears grim. Innate’s stock “looks extremely risky and I would avoid it at all costs,” Sean O’Neill, an analyst at the Motley Fool website, wrote Tuesday morning.

The unusual trading activity Friday “suggests that somebody with knowledge of the results was front-running the announcement,” O’Neill said. “That’s something I’d hope the regulator will be looking closer at.”

Statnews, a business news website, calculated that the Innate stock Collins still owns — which was worth $45.5 million at its peak — is now worth only $1.5 million. However, it is unclear how much money Collins invested in the company over the 15 years he has been involved with it.

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Collins’ relationship with the company has raised eyebrows in recent months. And the Office of Congressional Ethics is currently investigating whether Collins engaged in insider trading.

The Collins stock controversy almost sank ex-Rep. Tom Price’s nomination to lead the Health and Human Services Department after it was reported that the Georgia Republican and former Budget chairman had invested in Innate as well. Price sold his shares earlier this year for $250,000, after an initial $94,000 investment.

A source close to the company said the loss was only on paper and that Collins’ actual loses are just over $5 million, the amount he invested about 15 years ago when he first encountered the firm.

The source said he “never sold a share” in Innate. According to financial disclosure forms, Collins is worth upwards of $40 million — or at least he was before the Innate stock plummeted.