SEC v. Maurizio Chiriva-Internati, No. LR-26184, Southern District of Texas (Dec. 3, 2024) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26184 /December 3, 2024 Securities and Exchange Commission v. Maurizio Chiriva-Internati, No. 4:24-cv-04729 (S.D. Tex., filed Dec. 3, 2024) SEC Charges Former CEO of Biotherapeutics Company with Misleading Investors about Status of FDA Reviews The Securities and Exchange Commission today filed settled charges against Maurizio Chiriva-Internati, the former CEO of Houston-based biotherapeutics company, Kiromic BioPharma, Inc., for failing to disclose material information about Kiromic’s two cancer fighting drug candidates before, during, and after a July 2, 2021 follow-on public offering that raised $40 million. According to the SEC’s complaint, Kiromic raised $40 million in a public offering on July 2, 2021 for the purpose of funding the prospective clinical trials for its two cancer fighting drug candidates, the ALEXIS-PRO-1 and the ALEXIS-ISO-1. However, the complaint alleges that two weeks before the public offering, the Food and Drug Administration (FDA) notified Kiromic that it had placed the drug candidates on clinical hold—an FDA order to delay the proposed clinical investigations. The complaint also alleges that Kiromic did not disclose the FDA clinical holds in its SEC filings, investor roadshow calls, or during due diligence calls leading up to the offering, despite the fact that Kiromic disclosed the hypothetical risk of a clinical hold and the potential negative consequences on Kiromic’s business. The SEC’s complaint alleges that Chiriva learned about the FDA clinical holds for the ALEXIS-PRO-1 and the ALEXIS-ISO-1 on June 16 and 17, 2021, respectively. The complaint alleges that Chiriva reviewed, signed, and contributed content to a report filed with the SEC on June 25, 2021, and signed and certified another report filed with the SEC on August 13, 2021, both of which failed to disclose the FDA clinical holds. The complaint also alleges that three days before Kiromic’s offering, Chiriva participated in roadshow calls with investors and did not correct misstatements by another Kiromic officer about the status of the FDA review by disclosing the FDA’s clinical holds. The SEC’s complaint, filed in the U.S. District Court for the Southern District of Texas, charges Chiriva with violating Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 and Rule 13a-14 of the Securities Exchange Act of 1934 (“Exchange Act”), and for aiding and abetting Kiromic’s violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-15(a). Without admitting or denying the SEC’s allegations, Chiriva has agreed to settle the SEC’s charges by consenting to a $125,000 civil penalty, to be permanently enjoined from violating the antifraud, reporting, certification, and disclosure controls provisions of the federal securities laws, and to be barred for three years from serving as an officer or director of a public company. The settlement is subject to court approval. The SEC’s investigation was conducted by Kendrack Lewis of the SEC’s Fort Worth Regional Office, under the supervision of Samantha S. Martin and B. David Fraser. The SEC’s litigation will be led by Jennifer Reece and supervised by Keefe Bernstein.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26184 /December 3, 2024 Securities and Exchange Commission v. Maurizio Chiriva-Internati, No. 4:24-cv-04729 (S.D. Tex., filed Dec. 3, 2024) SEC Charges Former CEO of Biotherapeutics Company with Misleading Investors about Status of FDA Reviews The Securities and Exchange Commission today filed settled charges against Maurizio Chiriva-Internati, the former CEO of Houston-based biotherapeutics company, Kiromic BioPharma, Inc., for failing to disclose material information about Kiromic’s two cancer fighting drug candidates before, during, and after a July 2, 2021 follow-on public offering that raised $40 million. According to the SEC’s complaint, Kiromic raised $40 million in a public offering on July 2, 2021 for the purpose of funding the prospective clinical trials for its two cancer fighting drug candidates, the ALEXIS-PRO-1 and the ALEXIS-ISO-1. However, the complaint alleges that two weeks before the public offering, the Food and Drug Administration (FDA) notified Kiromic that it had placed the drug candidates on clinical hold—an FDA order to delay the proposed clinical investigations. The complaint also alleges that Kiromic did not disclose the FDA clinical holds in its SEC filings, investor roadshow calls, or during due diligence calls leading up to the offering, despite the fact that Kiromic disclosed the hypothetical risk of a clinical hold and the potential negative consequences on Kiromic’s business. The SEC’s complaint alleges that Chiriva learned about the FDA clinical holds for the ALEXIS-PRO-1 and the ALEXIS-ISO-1 on June 16 and 17, 2021, respectively. The complaint alleges that Chiriva reviewed, signed, and contributed content to a report filed with the SEC on June 25, 2021, and signed and certified another report filed with the SEC on August 13, 2021, both of which failed to disclose the FDA clinical holds. The complaint also alleges that three days before Kiromic’s offering, Chiriva participated in roadshow calls with investors and did not correct misstatements by another Kiromic officer about the status of the FDA review by disclosing the FDA’s clinical holds. The SEC’s complaint, filed in the U.S. District Court for the Southern District of Texas, charges Chiriva with violating Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 and Rule 13a-14 of the Securities Exchange Act of 1934 (“Exchange Act”), and for aiding and abetting Kiromic’s violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-15(a). Without admitting or denying the SEC’s allegations, Chiriva has agreed to settle the SEC’s charges by consenting to a $125,000 civil penalty, to be permanently enjoined from violating the antifraud, reporting, certification, and disclosure controls provisions of the federal securities laws, and to be barred for three years from serving as an officer or director of a public company. The settlement is subject to court approval. The SEC’s investigation was conducted by Kendrack Lewis of the SEC’s Fort Worth Regional Office, under the supervision of Samantha S. Martin and B. David Fraser. The SEC’s litigation will be led by Jennifer Reece and supervised by Keefe Bernstein.