'Wall Street Journal' Raises Possible Conflicts Of Interest For Rep. Tom Price
ROBERT SIEGEL, HOST:
A new report raises questions about the financial dealings of one of Donald Trump's top Cabinet picks. Trump chose Congressman Tom Price of Georgia for secretary of Health and Human Services. According to The Wall Street Journal, Price has been active in trading medical stocks, and he's done so even while working on health legislation in Congress, legislation that could affect those stock prices. Michelle Hackman wrote about this for the paper and she joins us from New York. Welcome to the program.
MICHELLE HACKMAN: Thank you for having me.
SIEGEL: How heavily invested is Congressman Price in these health-related stocks?
HACKMAN: Tom Price, you know, by background is an orthopedic surgeon. So it's probably fair to start off by saying this man is deeply interested in health care. This is his background and so it makes sense that he'd also, you know, know more about health-related stocks than other companies. As of the most recent filings, he has ownership in about 40 different companies that add up to - and this is probably a conservative estimate - but about $300,000 at least.
SIEGEL: You reported that well price was actively making trades, he was also actively shaping health legislation. Tell us first about the case of the 21st Century Cures Act and Price's stake in the company in Innate Immuno.
HACKMAN: Mr. Price was on the committee that wrote this law that among other things speeds up the process by which drugs and other medical devices can be approved. That really impacts companies that Mr. Price was also buying stock in at the same time that he was writing and passing this legislation, like Innate Immunotherapeutics, which has a drug. It's a multiple sclerosis drug that stands to benefit from accelerated passage through the FDA.
SIEGEL: Did the stock price increase?
HACKMAN: The stock price doubled after he invested it in August.
SIEGEL: And he was investing in other companies as well that were affected by the 21st Century Cures Act?
HACKMAN: Yes, he does. So he has stocks and several other pharmaceutical companies including Pfizer, who's also a campaign donor to him.
SIEGEL: He has been reporting this activity, do I understand that?
SIEGEL: Yeah. And what kind of laws or regulations govern members of Congress in the stock market when they do report their investments?
HACKMAN: Until about four years ago, members of Congress weren't required to even disclose their stock holdings. And four years ago, there was this public outrage in which a different congressman was sort of using his insider knowledge from his job to buy stocks and make a profit. And so they passed this law called the Stock Act - Stop Trading on Congressional Knowledge - where they required all members of Congress to file every trade they made within 45 days, made it explicitly illegal to buy or sell stocks on knowledge that they obtained as members of Congress.
SIEGEL: Did you hear anyone characterize his conflict of interest or potential conflict rising to the level of insider trading?
HACKMAN: No, we can't make that characterization for sure. I mean, there are some trades that he made that the timing is definitely questionable but I think the work of looking into whether he actually had insider knowledge is something that Senate committees would have to look into.
SIEGEL: If he's confirmed as secretary of Health and Human Services, Congressman Price would have to divest himself.
HACKMAN: That's true. So members of Congress are allowed to do this. Members of the administration have much stricter ethics rules.
SIEGEL: What did you hear back from either Congressman Price or the Trump transition team about the Wall Street Journal story?
HACKMAN: We called Congressman Price on Wednesday and he immediately referred us to the Trump transition. The Trump transition team told us naturally that Mr. Price is concentrated on being confirmed and that if he is, he will follow all ethics rules and divest from all these stocks.
SIEGEL: Reporter Michelle Hackman of The Wall Street Journal. Thanks for talking with us.
HACKMAN: Thank you.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.