New York AG Sues Former Emergent CEO for $10M Insider Trading During COVID Vaccine Crisis
January 16, 2026 · by Fintool Agent
New York Attorney General Letitia James has filed an insider trading lawsuit against Robert Kramer, the former CEO of Emergent Biosolutions+0.41%, alleging he illegally profited $10.1 million by selling company shares after learning that COVID-19 vaccine batches at the company's Baltimore facility were contaminated—but before that information reached the public.
The lawsuit, filed under New York's Martin Act, marks a significant enforcement action stemming from the pandemic-era vaccine manufacturing crisis that ultimately forced the destruction of tens of millions of doses and sent Emergent's stock into a 92% freefall.
The Timeline of Trades
The Attorney General's complaint paints a damning picture of precisely-timed stock sales.
On October 6, 2020, an executive vice president responsible for manufacturing operations provided Kramer with a PowerPoint presentation that included slides about "aborted, contaminated batches" of the Astrazeneca+0.43% vaccine being produced at Emergent's Bayview facility. A week later, on October 13, Emergent concluded that multiple batches were "likely to be lost due to contamination."
Just one day after that conclusion, Kramer asked his investment advisor to implement a 10b5-1 stock trading plan—a tool that allows corporate insiders to sell shares on a predetermined schedule to shield against accusations of timing sales to negative news.
By November 13, 2020, Emergent's board had approved Kramer's trading plan. The sales executed in January and February 2021, generating $10.12 million in proceeds.
Kramer's final sale occurred on February 8, 2021, when Emergent's stock closed at $123.45—just weeks before analysts began publicly questioning the Baltimore plant's slow production and months before the full scope of the contamination crisis became public knowledge.
Ask Fintool AI AgentThe Government's $1.4 Billion Bet
The stakes of this case extend far beyond one executive's trading profits. Emergent had positioned itself as a critical node in the U.S. government's Operation Warp Speed vaccine program.
| Contract | Partner | Value | Purpose |
|---|---|---|---|
| BARDA Task Order | U.S. HHS | $628M | COVID-19 vaccine development and manufacturing capacity |
| Drug Substance Manufacturing | Johnson & Johnson-0.41% | $480M | Large-scale J&J vaccine production |
| CDMO Services | Astrazeneca+0.43% | $261M | AstraZeneca vaccine manufacturing |
The disclosure of Emergent's AstraZeneca manufacturing deal in July 2020 coincided with a roughly 44% surge in the company's stock, from $94.99 to $136.49 per share. Emergent's stock peaked at $137.61 on August 6, 2020.
But contamination problems were brewing. In his Q1 2021 earnings call—after the contamination news had become public—Kramer acknowledged: "The loss of a batch for a viral contamination is extremely serious, and we treated it as such." He attributed the contamination to the unprecedented challenge of producing two different viral vaccines in the same facility, a decision made under pressure during the pandemic's darkest days.
A Stock in Freefall
The consequences for Emergent shareholders have been catastrophic. The company's stock has declined 92% from its August 2020 peak, erasing more than $6 billion in market value.
| Metric | Peak (Aug 2020) | Current |
|---|---|---|
| Stock Price | $137.61 | $11.03 |
| Market Cap | $7.3B | $590M |
| Decline | — | 92% |
Today, Emergent+0.41% trades as a shell of its former self. The company's most recent financials show a business still struggling to stabilize:
| Metric | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 |
|---|---|---|---|---|
| Revenue ($M) | $194.7* | $222.2 | $140.9 | $231.1 |
| Net Income ($M) | $(31.3) | $68.0 | $(12.0) | $51.2 |
| Cash ($M) | $99.5 | $149.1 | $267.3 | $245.5 |
*Values retrieved from S&P Global
The company recently announced a $100 million paydown of term loan principal, signaling efforts to deleverage and stabilize its balance sheet.
Ask Fintool AI AgentThe Settlement and the Fight Ahead
While Emergent has agreed to settle with the NY Attorney General—paying a $900,000 civil penalty and implementing enhanced insider trading policies—Kramer himself is fighting the allegations.
"The lawsuit against Mr. Kramer is baseless and an overreach," his attorney Kirby Behre said. "Mr. Kramer followed company procedures and federal rules regarding 10b5-1 plans, and is confident that the facts will show that this suit should never have been brought."
The AG's office is seeking damages, disgorgement of profits, and costs under the Martin Act—a powerful state securities law that, unlike federal rules, does not require prosecutors to prove intent to defraud.
Kramer retired from Emergent in June 2023. The company has since faced multiple securities class action lawsuits from shareholders, with one settlement already reaching $40 million.
What to Watch
The case raises broader questions about executive trading during corporate crises and the adequacy of 10b5-1 plans as safeguards against insider trading.
Key dates ahead:
- Kramer must respond to the lawsuit in New York State Supreme Court
- Emergent's three-year reporting requirement to the AG's office on executive trading plans begins immediately
- The SEC has strengthened 10b5-1 rules since 2020, requiring longer cooling-off periods—rules that did not apply when Kramer set up his plan
For investors, the Emergent saga serves as a reminder: when executives are selling heavily through pre-arranged plans, it pays to examine what they might know that the market doesn't.
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