See, unfortunately, this isn't the kind of thing I can provide documented evidence for.
Sure you can. By law every time a board member or executive officer sells or buys their own stock it is recorded by the FCC. Every single instance in the last two years was reported to the FEC and is availible for inspection
here (note you will want to click on the insider trading link which may take a year or two to load). If an executive makes a major trade not that long before news breaks about the dangers of a drug their company makes it is recorded and reported.
The reason why I can't provide documented evidence is as follows: if I COULD demonstrate it, they would already be charged, thus nullifying my point. Likewise, if they got away with it, it was because the insider trading was not tracked.
All insider trader is tracked by law. The above link gives you EVERY single instance in the US for the last two years.
Insider trading by proxy is almost impossible to proove. I say this on hearsay evidence so I'm sure you'll dispute it -- just those economic professors I've had have commented on it a lot. To show the person guilty you have to FIND a link, then demonstrate it, and a savvy blue collar criminal will think ahead in terms of years.
Okay so now you are saying that we don't just have amoral, greedy bastards commiting felonies, but we have other amoral, greedy bastards entering into conspiracies to commit felonies. Further ALL these people are such criminal masterminds that they have never dicked up and been caught.
Somehow of course the corrupt executive is going to have to get his payment from the proxy. I don't see all that many fool proof methods for doing so.
The problem is assuming that the investors aren't busy trying to dump the falling stock. By the time anyone gets around to voting you've got a large number of people that were not involved in the drop, and most people who are part of a large mutual fund/diversified portfolio won't be tracking that one particular stock with a great deal of attention.
BS. Many stocks are held by long term investors who simply weather such storms. Many such investors are doing so through the services of mutual funds, investment managers (who have thousands of accounts or more), and other managed accounts. Those people will not be selling and some of the professionals they hire to manage their money will look into these things. Likewise you have the billionaire investors (like Warren Buffet) who scoop up stock from mismanaged companies and then fire the management.
However, I will agree that repeatedly soaking investors is a bad, short term idea. That being said, it happens. That being said, bank robbery is a terrible idea too, with a very high rate of capture. People still do it.
Show me an example of repetitive soaking.
I'm not sure that "trivial" to proove is the correct term. Rather, I would say we have only CAUGHT those people for whom it WAS trivial to proove.
I'm not asking for a legal proof of fraud. I'm asking for examples of executives who sold their stock in a short timeframe before the bad news and price correction.
All their trades are recorded and reported. If you think Merck executives dumped stock before informing the FDA of Vioxx troubles, then show me the SEC filings they dumped stock just before.
I will leave the conspiracy to defraud shareholders with as yet unnamed method of payout alone for now.
I'm not the only person that thinks this way. These ideas are coming from an economics professor I had, but to me they make a lot of sense. Here's a link of some similar figures.
Advocacy group. A quick glance spotted several BS claims. However you are ranging pretty far afield here. The accusation isn't that white collar crime occurs, or even that it occurs in drug companies. It is that drug companies, or their executives, have incentives to persue bad science.
Just to re-iterate, you are asking me to show you three drug insiders who scammed investors for LOTS of money, and then who NEVER GOT CAUGHT.
Caught, didn't get caught, insufficient evidence to convict ... doesn't matter to me. Just point me to the SEC filings just prior to their bad science going public.
Believe me, I'd love nothing more than to demonstrate this... but the closest I could get would be to show someone that evaded capture for ten to fifteen years -- and I'm not about to do research on that because there have been reforms since then, and we are talking about the current situation.
You could wade through the SEC filings in the days/weeks/months prior to a drug having problems and show that yes executives were making suspicious transactions in that time period. More realisticly you could look for investor reports, particularly in cases where leadership struggles were occuring, and find someone elses work showing that an executive sold off prior. I'm not asking you to prove guilt beyond a reasonable shadow of doubt, I'm asking that you prove that transaction which might
possibly have happened in the manner you suggested occured.
To reverse the situation, how can you proove that EVERY drug insider DOES get caught?
I can prove that any given insider didn't sell off a block of stock just prior the drug going tits up. Show us some who have sold large blocks of stock under suspiscious circumstances; as you know your claim, your burden of proof.
I think this point of view is idealistic. Testers which tend to give positive results do tend to get hired back more often.
We've gotten bonuses for giving negative results.
To be more accurate, I'm demonstrating a plausable reason for WHY they might be involved in such crime.
Please. At the end of the day your little theory fails to remember that pushing shoddy science isn't the only way they can soak the investors. From creative bookkeeping to misstating earnings/losses to using acquisition information (which is ridiciously common in the drug industry) are all viable ways of defrauding investors - and these HAVE been demonstrated. If you were the great white collar criminal why in hell would you dick with the clinical trials? There are far more people involved, far greater reason for the rare scientist with a conscious to blow the whistle, and gratuitiously longer papertrails. Even if you manage not to blow the game, you still face hell trying to predict when the drug will go tits up and assuming this were really likely that someone else wouldn't be doing the same damn thing with another drug and destroy your 'profits' before you can cash out.
Of all the ways to defraud the investors, this has got to be one of the most likely to fail. If you have THIS much influence why are you dicking around with something THIS convoluted?
Wong has, IMHO, pretty conclusively evidenced that it DOES happen.
Wong has provided ample evidence that new side effects are found after drugs are declared safe. Wong has also provided evidence that some clinical trials were insufficiently rigorious. NOWHERE has he given even minimal evidence of fraudulent conduct. Indeed when I orginally chided him about the fraud and falsification angle he corrected me that his concerns were about negligence.
You are saying there are great incentives for people NOT to perform these actions deliberately, and every time it has happened it has been a special case, because in GENERAL no one would risk the suits.
No, not all that long ago shoddy science paid out. When a drug was found to have new side effects the stock price didn't take as serious a hammering. The market response has changed so the direction of profit motive has changed. The cost/benifit analysis between "get it to market" and "don't get the company sued" has shifted.
I merely wish to show that, perhaps, there are plausable reasons to, as you said, risk the suits -- these reasons being that they MAY be crafty and skilled at manipulating stock,
In which case it boggles the mind why they are dicking around with clinical trials rather than just traditional defrauding of the investors, particularly given the longer papertrails.
OR they are merely incompetent
Right but not so incompotent to be tossed by the shareholders, but compotent enough to see a benifit in dicking with the science
OR they have idiotic investors
The stastical likelihood that each of the millions of investors in Merck (for example) is an idiot is astronomical. Even if we restrict ourselves to the 1000 largest investors the idea that all of them fall under the idiotic category defies the logic of the bell curve (evening assuming 90% of all investors are idiots, you still end up with 1.7 EE -44% chance of them all being idiots).
At any given time any one of these may be true -- I am not saying that they are all true every time, nor guaranteed to be.
And I'm saying this is all BS retconning of the fact that you have already decided they are evil and are groping at straws to find something beyond comic book supervilliany.
You call it retconning for me to have "already decided that they are guilty of bad science" but I think that Mike's data shows that they ARE.
Mike's "data" shows that Mike thinks it is bad science for a drug which has to have certain chemical activity to fit into the opiate receptor looks like another drug which also fits into the opiate receptor
Mike has some good data, unfortunately much of it is
old and conditions have changed since then.
You are, if I understand you correctly, saying that it's not bad science because to do so would be to go against powerful economic incentives.
No I'm saying I challenged Mike to provide three examples from the last five years, he hasn't done so yet.
When we go over Vioxx I'm explaining exactly what the damn trials meant and am still waiting to hear what quantified standard Mike thinks should be imposed on them.
If you have specific
examples of bad science, then I will go over them from a scientific perspective (i.e. how likely was this side effect to be found in a 5,000 patient, 12 month clinical trial). However the incentive to fudge the science has already shifted the other way - you stand to lose more by fudging the science than by encouraging good science.
Very funny, Scotty. Now beam down my clothes.