Ethics Probe of GOP Rep. Is Connected to Biotech Firm With Failed MS Drug

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U.S. Rep. Chris Collins (R-NY) (U.S. House of Representatives)

The House Ethics Committee said Thursday it was extending its review of Republican Rep. Chris Collins of New York, whose stock market trades prompted an advocacy group to request an investigation for possible violation of insider trading or conflict of interest.

Collins, who has denied any wrongdoing, was the largest shareholder of Australia's Innate Immunotherapeutics Limited and sat on the company's board of directors. Advocacy groups had said Collins sponsored legislation that could potentially benefit the company.

As part of its extension, the Ethics Committee also released the findings of the independent Office of Congressional Ethics. The OCE had referred the Collins case to the committee in July. Its 29-page report was made public for the first time.

The OCE reviewed three allegations:

— Collins may have shared material, nonpublic information about Innate Immunotherapeutics in the purchase of the company's stock.
— Collins attended a meeting at the National Institutes of Health in November 2013 and in that meeting requested an NIH employee meet with Innate employees to assist in drug trial designs.
— Collins may have purchased stock unavailable to the public and that was offered to him based on his status as a member of the House.


The OCE's board recommended the committee further review the first two allegations because there was "substantial reason to believe" Collins shared nonpublic information in the purchase of Innate stock and that he took official actions or requested official actions that would assist a single entity in which he had a significant financial interest.

The board recommended the dismissal of the allegation that Collins purchase discounted stock unavailable to the public and offered to him based on his status as a lawmaker.

"Throughout my tenure in Congress I have followed all rules and ethical guidelines when it comes to my personal investments," Collins said upon the release of the OCE's report. "I was elected to Congress based upon my success in the private sector, and my willingness to use that experience every day to facilitate an environment that creates economic opportunity and jobs."

Collins thanked the committee for its review in the case and "for the tough work they do to hold all members of Congress accountable to the highest standards of conduct."

Innate Immunotherapeutics stock value has tanked by more than 94 percent during recent months and now trades for pennies a share. The company's prospects tanked after its multiple sclerosis drug failed to demonstrate a meaningful benefit for patients.

A source close to the congressman, who spoke on condition of anonymity to discuss private actions, said Collins invested about $5 million in the company over the years and did not sell any of his shares.