[Skip to Content]
Access to paid content on this site is currently suspended due to excessive activity being detected from your IP address 54.211.168.204. Please contact the publisher to request reinstatement.
[Skip to Content Landing]
Views 1,161
Citations 0
Special Communication
December 2015

Physicians and Insider Trading

Author Affiliations
  • 1Division of Pharmacoepidemiology and Pharmacoeconomics, Department of Medicine, Brigham and Women’s Hospital and Harvard Medical School, Boston, Massachusetts
  • 2Department of Internal Medicine, Boston Medical Center, Boston, Massachusetts
  • 3Department of Medical Ethics & Health Policy, University of Pennsylvania Perelman School of Medicine, Philadelphia
JAMA Intern Med. 2015;175(12):1955-1959. doi:10.1001/jamainternmed.2015.5610
Abstract

Although insider trading is illegal, recent high-profile cases have involved physicians and scientists who are part of corporate governance or who have access to information about clinical trials of investigational products. Insider trading occurs when a person in possession of information that might affect the share price of a company’s stock uses that information to buy or sell securities—or supplies that information to others who buy or sell—when the person is expected to keep such information confidential. The input that physicians and scientists provide to business leaders can serve legitimate social functions, but insider trading threatens to undermine any positive outcomes of these relationships. We review insider-trading rules and consider approaches to securities fraud in the health care field. Given the magnitude of the potential financial rewards, the ease of concealing illegal conduct, and the absence of identifiable victims, the temptation for physicians and scientists to engage in insider trading will always be present. Minimizing the occurrence of insider trading will require robust education, strictly enforced contractual provisions, and selective prohibitions against high-risk conduct, such as participation in expert consulting networks and online physician forums, by those individuals with access to valuable inside information.

×