Vertex Pharma CEO Buys the Stock Dip

Vertex Pharmaceuticals CEO Reshma Kewalramani bought a big chunk of stock after it tumbled more than 20%. (Dina Rudick/Anthem Multimedia for Vertex Pharmaceuticals)

Vertex Pharma ceuticals CEO Reshma Kewalramani bought a big chunk of the biotech’s stock earlier this month. The move, her first open-market purchase in years, appears to be a show of confidence in the stock, which took a big hit after the company disclosed disappointing drug-pipeline news.

On Aug. 5, Vertex shares tumbled more than 20%, to $375 from $472, after the company disclosed that its promising pain drug VX-993 had performed poorly in a recent Phase 2 trial and wouldn’t advance to the next stage of trials. At the same time, the company said the Food and Drug Administration signaled that it was unlikely to expand the list of approved uses of another key Vertex pain product, suzetrigine, marketed under the name Journavx.

The next day, Aug. 6, Kewalramani paid $3.9 million to purchase 10,000 Vertex shares for an average price of just under $390 each, according to a form she filed with the Securities and Exchange Commission.

The news overshadowed a strong second-quarter earnings report in which the company beat analyst forecasts for adjusted profits.

Vertex didn’t make Kewalramani available to comment on her stock purchase, and the company declined to comment. Since its big decline on Aug. 5, Vertex shares have been mostly flat, trading at about $383 on Thursday.

Kewalramani last bought Vertex shares in August 2021, according to SEC filings, when she paid $2 million for 10,000 shares, an average price of $195.65 each. More recently, Kewalramani has been a seller. In November, she sold 15,198 Vertex shares for $7.8 million, an average price of $515, through a trading plan.

Following her most recent moves, Kewalramani owns a total of 115,968 shares.

Write to Ian Salisbury at ian.salisbury@barrons.com