Moderna CEO Stephane Bancel has sold $408 million in company stock since the beginning of the pandemic — averaging roughly $3.6 million a week — as the company’s stock soared on the development and rollout of its Covid vaccine, according to CNBC’s analysis of the company’s securities filings.

Prior to the pandemic, biotech companies in Cambridge, Massachusetts and their French CEO didn’t have a lot of recognition outside of those who work in biotech. Moderna quickly developed the two-dose Covid vaccine, in collaboration with the National Institutes of Health. The taxpayer supported Operation Warp Speed.

Moderna’s shot is now second in use after Pfizer for Covid vaccinations. More than 209,000,000 doses have been administered by the Centers for Disease Control and Prevention.

Equilar director Courtney Yu stated that Bancel sales are a reflection of how successful the company’s stock is in relation to its success with the vaccine. Equilar provides information on executive compensation and independently validated Bancel’s sales.

Moderna has seen its stock rise by 6144% over the last year. first announcingIt received funding from Coalition for Epidemic Preparedness Innovations on January 23, 2020 to create a coronavirus vaccination. Moderna received emergency approval from the FDA in December 2020. 

Moderna’s Covid vaccine is still the sole commercially-available product of this biotech company. The shots have made Bancel a billionaire with an estimated net worth of more than $5.3 billion in company equity alone — based on his reported holdings as of March 1 and Wednesday’s closing price — and Investors were rewarded with a huge profit. The company was 12 years old and went public in December 2018., booked its first profit last year — $12.2 billion — on $17.7 billion in Covid vaccine sales. This year, it expects to sell signature shots at least $19billion.

Bancel received $408million in cash from January 2020 through 10b5-1 Stock Plans, adopted before 2018’s pandemic. This plan allows executives to buy a certain number of shares and have the broker execute them at set intervals. It is intended to prevent insider trading. More than twenty years ago, the Securities and Exchange Commission established 10b5-1 to allow executives to cash in their shares. This allows them to avoid being accused of insider trading and potentially facing legal action.

Moderna’s proxy report 2022 states that Moderna’s executive must trade under 10b5-1 plans. Shares are then sold in open trading windows under company’s insider trading policies.

David Larcker (a Stanford graduate school of business professor of accounting), said that 10b5-1 plans are meant to provide a “safe harbor” from being sued.

Together,Bancel had sold more than 2 million shares between January 2020 and February 2020, according to trading plans that were in place before the pandemic. He sold about $3.2 million worth of shares between Moderna’s IPO and the announcement by CEPI funding to the vaccine.

There are few regulations that the SEC enforces regarding 10b5-1 plans. The only exception is the restriction that they can’t be adopted or modified while in possession materially nonpublic information. The plans can be flexible, and they may vary between companies because there are not many rules.

Daniel Taylor from the Wharton School, professor of accounting said “Currently SEC regulations are quite lax about the plans.” Taylor explained that although Moderna does require its executives to trade in 10b5-1 plans to maintain “good corporate hygiene”, other companies can decide whether to adopt such a plan.

Although 10b5-1 Plans are intended to protect insider trading, their transparency is a problem. Executives of companies that trade under the 10b5-1 plan aren’t required to report to the SEC any information about such plans.

Moderna did not comment on whether the company would make public the 10b5-1 details for Bancel. However, his stock sales filings provide information about the date his trading plans were approved. They also list the amendments that took place in September 2019, 2020, and 2020. Moderna claimed that Bancel’s 10b5-1 trading programme was modified in May 2021, to allow him to give more charitable donations. Bancel donated thousands of shares to charities.

Taylor explained that 10b5-1 plans are not subject to disclosure.

CNBC has found that Bancel usually sells around 19,000 shares every week as part of his 10b5-1 plans. That’s an average selling price of $3.6million every seven days according to CNBC analysis. There are typically two types of shares being sold: 10,000 directly owned by Bancel, while 9,000 indirectly through an OCHA limited liability company. Bancel’s direct ownership of around 861,000 shares has resulted in a sale value of about $153million.

According to SEC filings Bancel is OCHA’s majority equity holder. Since January 2020, he has sold approximately 972,000 Moderna Shares indirectly through OCHA for a value of around $170 Million. OCHA, which is listed in Massachusetts as an investment company according to its corporate filings.

OCHA is registered in Delaware. This state does not require that companies disclose the nature and purpose of their businesses upon registration. Moderna spokeswoman Bancel did not provide further details about the company.

Bancel sold 191,000 shares through Boston Biotech Ventures. The total amount of his indirect ownership is approximately $13 Million since January 2020. Boston Biotech Ventures (limited liability) provides investment in angel investments to Boston start-ups. It also files patents to create new companies according to Massachusetts corporate filings. According to SEC filings Bancel is majority shareholder and sole managing member at Boston Biotech Ventures.

Bancel has also established an independent trust fund to support his children. It has been selling about 752,000 Moderna shares, with a value of around $67 million, since January 2020.

Democratic senators. Elizabeth Warren (Massachusetts), Chris Van Hollen (Maryland), and Sherrod Bold of Ohio called for the SEC’s reform of the 10b5-1 Rule to improve transparency. In December last year, the SEC proposed a several changesFor example, companies must disclose in quarterly reports whether they have adopted or terminated 10b5-1 plans. These changes are not yet in place.

Taylor stated that people are interested in the lack of transparency mandated by SEC. “If [Bancel]If he had made the 2018 plan public, would we have been so keen to buy his goods? The answer I believe is “Probably not.”