A healthcare provider may become privy to information about a drug or medical device during the course of research or clinical trials. Acting or releasing certain types of information is illegal and unethical.


Types of information:

(1) Insider information involves nonpublic information related to a public company.

(2) Material information is that which would cause a reasonable investor to make an investment decision.


Insider information for a clinical study may include:

(1) research data

(2) results of clinical trials

(3) reports of adverse effects

(4) manuscripts of papers or abstracts

(5) communications


A legal violation occurs if a person discloses insider information in violation of a duty of trust or confidence. The duty of confidence is a part of the confidentiality agreement entered into by the healthcare provider. A moral breach of duty may occur even if a legal violation has not occurred.


Material insider information:

(1) may be used by the insider

(2) given to a family member or relative

(3) given to a friend or acquaintance


Actions that may be taken as a result of insider information:

(1) purchase of a company's stock (if news is positive)

(2) sale or shorting of a company's stock (if news is negative)


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