Ex-Merck Analyst to Plead Guilty in Insider-Trading Case

An ex-analyst for Merck & Co. accused of passing merger tips to a former business school classmate at Bank of New York Mellon Corp. will plead guilty to federal charges, his lawyer said Monday.

The analyst, Zachary Zwerko, is charged with giving inside information to David Post, the ex-BNY employee, who used it to make $700,000 in illegal profits. Post pleaded guilty to one count of conspiracy and three counts of securities fraud in October.

Zwerko’s lawyer, Jeffrey Denner, told U.S. District Judge Alvin Hellerstein in Manhattan that his client plans to plead guilty and is working to complete an agreement with prosecutors. The judge set a hearing for Feb. 19.

Post admitted trading on tips from Zwerko about negotiations between Merck and Idenix Pharmaceuticals Inc. before the June 9 announcement that Merck had agreed to acquire the company for $24.50 a share.

Post, who is cooperating with U.S. investigators, also admitted trading on nonpublic information about private negotiations in 2012 between Ardea Bioscience Inc. and drug companies, including Merck, participating in a competitive-bidding process that resulted in an April 23, 2012, announcement that AstraZeneca Plc would acquire Ardea for $32 a share.

The case is U.S. v. Zwerko, 14-cr-00715, U.S. District Court, Southern District of New York (Manhattan).

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