Republican Rep. Chris Collins of NY was the largest shareholder of Australia's Innate Immunotherapeutics and was on the company's board of directors. By doing that, Collins may have violated the federal Stop Trading on Congressional Knowledge (STOCK) Act, a law barring insider trading among members of Congress, as well as House ethics guidelines.
But the Office of Congressional Ethics - which does preliminary investigations and makes its recommendations to the Ethics Committee, which has the power to punish lawmakers - urged the committee to keep investigating.
Collins, who is Innate's largest shareholder, denied any wrongdoing.
The report was published Thursday by the House Ethics Committee pursuant to House rules requiring its public release.
"It has never been more obvious that the term "Representative" is misapplied when it comes to Chris Collins, and the decision released today by the House Ethics Committee to continue its investigation of him reinforces that", said Judith Hunter, the Livingston County Democratic Chair.
"He put his obsession to enrich himself before the people he swore to represent".
Ethics rules in Congress are too lax, and since the Legislative Branch has proven that it can't be counted on to regulate itself, the public must demand all inside traders regardless of party be investigated. The meeting between Innate and the NIH, they added, was routine and in line with the agency's mission of supporting medical research and communicating health sciences information.
Advocacy groups say Collins sponsored legislation that could potentially benefit the company.
OCE identified multiple instances in which Collins provided updates to US investors regarding clinical trials and a private placement offering. Dems plead for nursing home residents' right to sue Senate confirms No. 2 spot at HHS, days after Price resigns MORE, according to the OCE report.
"Former Secretary Tom Price, who refused to cooperate with this investigation, was involved in this scandal and was eventually forced to sell the same stocks in question due to conflicts of interest".
The second allegation against Collins concerns discussions with NIH employees in 2013. The official then invited Collins for a visit.
In interviews with OCE, Collins "stated that he went to NIH as a private citizen and that his visit had no relation to any official duties" but also described it as akin to a "high school field trip", the report said. In that meeting, Collins is alleged to have asked with help in designing Innate Immuno's drug trial.
This story was updated at 3:09 p.m.