Nippon Shoji and Eisai share probe

A total of 175 executives and employees of Japanese drugmaker and wholesaler Nippon Shogi Kaishi sold company shares last year, and some may have used insider information about patient deaths during trials of the antiviral Usevir (sorivudine) to sell their shares before the knowledge became public, according to a statement by the company in The Japan Times.

The report suggests that several employees of Eisai, Nippon Shoji Kaisha's partner for sorivudine, also sold shares in the company using the same information.

The two companies were informed of the information on September 20, 1993, while the public announcement was made on October 12. Following the public release, Nippon Shoji's stock price dropped by around 500 yen ($4.90) to 2,660 yen per share within one day. The focus of the probe is therefore on share sales during the period September 20 - October 12. A survey of Nippon Shoji's entire staff showed that a total of 385,000 shares were sold by employees during the time in question. So far, 15 people questioned have admitted using the knowledge of the deaths as a basis to sell their shares before the matter became public knowledge. A spokesperson for Eisai said that he did not believe any of Eisai's employees sold shares, but added that it is impossible to keep track of private stock transactions.