Insider Trading, Option Exercises and Private Benefits of Control (Revision of DP 2010-32)

We investigate patterns of abnormal stock performance around insider trades and option exercises on the Dutch market. Listed firms in the Netherlands have a long tradition of employing many anti-shareholder mechanisms limiting shareholders rights. Our results imply that insider transactions are more profitable at firms where shareholder rights are not restricted by anti-shareholder mechanisms. This finding goes against the monitoring hypothesis which states that more shareholder orientation and stronger blockholders would reduce the gains from insider trading. We show robust support for the substitution hypothesis as insiders of firms which effectively curtail shareholder rights enjoy valuable private benefits of control in lieu of engaging in insider trading to exploit their position.insider trading;management stock options;timing by insiders;corporate governance;anti-shareholder mechanisms;anti-takeover mechanisms

Shareholder Activism through Proxy Proposals: The European Perspective

This paper is the first to investigate the corporate governance role of shareholderinitiated proxy proposals in European firms. While proposals in the US are nonbinding even if they pass the shareholder vote, they are legally binding in the UK and most of Continental Europe. Nonetheless, submissions remain relatively infrequent in Continental Europe in particular, with major variations across countries in ownership structures, monitoring incentives, and the laws and regulations governing shareholder access to the proxy. We use sample selection models to analyze target selection and proposal success in terms of the voting outcomes and the stock price effects, and make several contributions to the literature. First, proposal submissions remain infrequent compared to the US in Continental Europe in particular. In the UK proposals typically relate to a proxy contest seeking board changes, while in Continental Europe they are more focused on specific governance issues. Second, there is some evidence that the proposal sponsors are valuable monitors, because the target firms tend to underperform and have low leverage. The sponsors also observe the identity of the voting shareholders, because proposal probability increases in the target’s ownership concentration and the equity stake of institutional investors. Third, while proposals enjoy limited voting success across Europe, they are relatively more successful in the UK. The outcomes are strongest for proposals targeting the board but are also affected by the target characteristics including the CEO’s pay-performance sensitivity. Finally, proposals are met with strong negative stock price effects when they are voted upon at general meetings. This suggests that rather than attribute them control benefits, the market often interprets proposals and their failure to pass the vote as a negative signal of governance concerns. Indeed, the market responds better to proposals submitted against large firms with low leverage, which is consistent with agency considerations. However, the stock price effects are most negative for poorly performing firms with low market-to-book ratios, which implies that the proposal outcomes only intensify the market’s concerns over firms that have previously underperformed.Shareholder activism;shareholder proposals;corporate governance;sample selection

Insider Trading, Option Exercises and Private Benefits of Control (Revision of DP 2010-32)

We investigate patterns of abnormal stock performance around insider trades and option exercises on the Dutch market. Listed firms in the Netherlands have a long tradition of employing many anti-shareholder mechanisms limiting shareholders rights. Our results imply that insider transactions are more profitable at firms where shareholder rights are not restricted by anti-shareholder mechanisms. This finding goes against the monitoring hypothesis which states that more shareholder orientation and stronger blockholders would reduce the gains from insider trading. We show robust support for the substitution hypothesis as insiders of firms which effectively curtail shareholder rights enjoy valuable private benefits of control in lieu of engaging in insider trading to exploit their position.

Beneficial effects of a novel ultrapotent poly(ADP-ribose) polymerase inhibitor in murine models of heart failure

Overactivation of the nuclear enzyme poly(ADP-ribose) polymerase (PARP) contributes to the development of cell dysfunction and tissue injury in various pathophysiological conditions associated with oxidative and nitrosative stress, including myocardial reperfusion injury, heart transplantation, diabetic cardiomyopathy and chronic heart failure. In recent studies, we have demonstrated the beneficial effects of a novel ultrapotent PARP inhibitor, INO-1001, on cardiac and endothelial dysfunction and remodeling in rat model of advanced aging-associated chronic heart failure and in a mouse model of heart failure induced by aortic banding. In the current study, we have investigated the effect of INO-1001 on the development of heart failure induced by permanent ligation of the left anterior descending coronary artery, heart failure induced by doxorubicin and acute myocardial dysfunction induced by bacterial endotoxin. In the coronary ligation model, a significantly depressed left ventricular performance and impaired vascular relaxation of aortic rings were found, and PARP inhibition significantly improved both cardiac function and vascular relaxation. In the doxorubicin model, a single injection of doxorubicin induced high mortality and a significant decrease in left ventricular systolic pressure, +dP/dt, -dP/dt, stroke volume, stroke work, ejection fraction and cardiac output. Treatment with the PARP inhibitor reduced doxorubicin-induced mortality and markedly improved cardiac function. PARP inhibition did not interfere with doxorubicin's antitumor effect. In the endotoxin model of cardiac dysfunction, PARP inhibition attenuated the suppression of myocardial contractility elicited by endotoxin. The current data strengthen the view that PARP inhibition may represent an effective approach for the experimental therapy of various forms of acute and chronic heart failure

Angiotensin Receptor Neprilysin Inhibition Compared With Enalapril on the Risk of Clinical Progression in Surviving Patients With Heart Failure

BACKGROUND: -Clinical trials in heart failure have focused on the improvement in symptoms or decreases in the risk of death and other cardiovascular events. Little is known about the effect of drugs on the risk of clinical deterioration in surviving patients. METHODS AND RESULTS: -We compared the angiotensin-neprilysin inhibitor LCZ696 (400 mg daily) with the angiotensinconverting enzyme inhibitor enalapril (20 mg daily) in 8399 patients with heart failure and reduced ejection fraction in a double-blind trial. The analyses focused on prespecified measures of nonfatal clinical deterioration. In comparison with the enalapril group, fewer LCZ696-treated patients required intensification of medical treatment for heart failure (520 versus 604; hazard ratio, 0.84; 95% confidence interval, 0.74-0.94; P=0.003) or an emergency department visit for worsening heart failure (hazard ratio, 0.66; 95% confidence interval, 0.52-0.85; P=0.001). The patients in the LCZ696 group had 23% fewer hospitalizations for worsening heart failure (851 versus 1079; P<0.001) and were less likely to require intensive care (768 versus 879; 18% rate reduction, P=0.005), to receive intravenous positive inotropic agents (31% risk reduction, P<0.001), and to have implantation of a heart failure device or cardiac transplantation (22% risk reduction, P=0.07). The reduction in heart failure hospitalization with LCZ696 was evident within the first 30 days after randomization. Worsening of symptom scores in surviving patients was consistently more common in the enalapril group. LCZ696 led to an early and sustained reduction in biomarkers of myocardial wall stress and injury (N-terminal pro-Btype natriuretic peptide and troponin) versus enalapril. CONCLUSIONS: -Angiotensin-neprilysin inhibition prevents the clinical progression of surviving patients with heart failure more effectively than angiotensin-converting enzyme inhibition. Clinical Trial Registration-URL: http://www.clinicaltrials.gov. Unique identifier: NCT01035255

Cardiopoietic cell therapy for advanced ischemic heart failure: results at 39 weeks of the prospective, randomized, double blind, sham-controlled CHART-1 clinical trial

Cardiopoietic cells, produced through cardiogenic conditioning of patients' mesenchymal stem cells, have shown preliminary efficacy. The Congestive Heart Failure Cardiopoietic Regenerative Therapy (CHART-1) trial aimed to validate cardiopoiesis-based biotherapy in a larger heart failure cohort

Insider trading, shareholder activism, and corporate policies

This doctoral thesis focuses on two topics that have received considerable attention from academics, regulators, and the business press over the past decades: insider trading, and shareholder activism. The first chapter evaluates proxy proposals as a corporate governance device in Europe. The second chapter analyzes the relation between firm-level corporate governance rules and the profitability of insider trading. The third chapter investigates whether trading by bank insiders prior to the recent subprime mortgage crisis is related to bank performance during the crisis. The fourth chapter examines the relation between CEO tenure, contract horizon, and insider trading