The president of the MD Anderson Cancer Center in Houston, Texas, already embroiled in a grant funding controversy involving his wife, promoted the sliding stock of a cancer-drug company he co-founded in an appearance on the CNBC cable television channel on 18 May.
The Cancer Letter broke the news on 1 June about Ronald DePinho’s appearance on “Closing Bell with Maria Bartiromo”. DePinho’s appearance on the show, which many viewers watch for stock-buying tips, came ten days after it was revealed that Alfred Gilman, the Nobel prize-winning lead scientist at the Cancer Prevention and Research Institute of Texas (CPRIT), was stepping down from his position. In his resignation letter, Gilman cited concerns over a speedy, US$18-million award to a team led by Lynda Chin, an MD Anderson cancer scientist who is married to DePinho. (It now emerges that Gilman was urged towards the door by senior CPRIT management. See below.) Because the award to Chin and her team was made under the institute’s commercialization portfolio, it was not scientifically reviewed but assessed by CPRIT’s Commercialization Review Council. DePinho and Chin defended the award and the process in interviews with Nature published yesterday, the same day that CPRIT announced that the award will be re-reviewed.
Watch the CNBC interview below:
DePinho’s comments lauding the company, Aveo Pharmaceuticals, in which he and his family trust own 590,440 shares, come in the middle of the interview and are as follows:
Bartiromo: Are there companies out there that you think are most promising, and also what is going to come out of this ASCO [American Society for Clinical Oncology] meeting, do you think?
DePinho: Well, the companies in the biotech sector, you have to be very careful because you have to really understand which companies are driven by good management, that are driven by the kinds of scientific advances that I’ve mentioned, and there are a few of them out there. Historically of course Genentech was one of the prime examples of this, more recently a company —
Bartiromo: They were the first to come out with that “targeted…”
DePinho: Right. Targeted. So you think about Herceptin and so on, those are very important advances. And, in fact, some of the most effective drugs have come out of the idea of using science to shepherd the cancer-drug development.
A company that I was involved in founding — Aveo Pharmaceuticals, one of the more successful biotechs —
Bartiromo: That’s A-V-E-O? The symbol?
DePinho: That’s correct — has utilized, has exploited, science-driven drug discovery, and it’s about to announce, or has announced already publicly, and will present in detail at ASCO, a very effective drug that has a superior safety profile for renal-cell cancer, a major unmet need. So these are massive advances in our ability to really do something about a disease that has long been very refractory.
Shares in Aveo were trading at $11.28 just before DePinho went on camera. They have climbed since the interview and were trading at $12.73 at close of trading on 31 May. The appreciation raised the worth of DePinho’s holdings from $6.66 million on 18 May to $7.52 million at closing yesterday. (On 1 June last year, one share in Aveo was worth $18.87. The company went public in March 2010 at $9.00 a share.)
New clinical data on Aveo’s kidney-cancer drug, the tyrosine-kinase inhibitor tivozanib, are being presented tomorrow at ASCO. The Cancer Letter reports that, if the drug is ultimately approved by the US Food and Drug Administration, it would become the fifth in its class for fighting renal-cell carcinoma, a relatively rare cancer.
DePinho apologized for his CNBC comments in his interview with The Cancer Letter:
“I am a public official in a position of trust, and I should never comment on any of my personal holdings or give investment advice… It was a mistake for me to do so on the CNBC interview.”
He added: “It was a very fast-moving interview, which in the context of what Maria and I were talking beforehand, versus what we were talking on air, etc. It unfolded the way it did. And it will not happen again.”
Separately, the Dallas Morning News has obtained, under Texas public-records law, hundreds of pages of documents, including e-mails and letters, showing that the chief scientific officer at CPRIT was pushed towards the door by CPRIT’s top manager. Before Gilman submitted this letter of resignation on 8 May, William Gimson, CPRIT’s executive director, urged him to leave, the newspaper reports, “because the governing board ‘has no faith in your ability to do your job.’ ”
The newspaper account continues:
“I told them I would not resign, they would need to dismiss me,’’ wrote Gilman in an email to several colleagues, including Dr. Daniel Podolsky, president of the University of Texas Southwestern Medical Center.
The resignation request by… Gimson… came after Gilman wrote a four-page letter in which he warned that ‘political considerations’ should have no place in deciding how CPRIT should award public dollars……
Dozens of emails focus on Gilman’s stance that CPRIT’s ‘peer review’ system, in which out-of-state scientists review applications to avoid possible conflicts of interest, is under attack from foes, including some members of the agency’s Oversight Committee that Gilman referred to as ‘really evil people.’
In an e-mailed comment today, Gimson said of the e-mails: “CPRIT is unable to comment. I’d like to point out that these emails have only come to our attention very recently, and we are still sorting through them to determine appropriate next steps.”
Also on 1 June, CPRIT released the following statement:
Yesterday, CPRIT executive director Bill Gimson and chief scientific officer Dr. Al Gilman met in person to discuss the MD Anderson resubmission of its portion of the Houston-area Incubator proposal to CPRIT. Also discussed was the exact timetable for seven multi-investigator grants that were held back in March and will be presented to the Oversight Committee in July.
They went on to discuss opportunities to put in place processes that will improve all present and future grant review issues — while continuing to ensure CPRIT’s integrity by keeping the award process separate from political considerations — as it has been through 387 grants awarded to date.
The executive director and chief scientific officer are working diligently to focus on the critical work of the Institute.