Litigation Releases (Cheryl R. Kramer)

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 26652 / September 29, 2026

Securities and Exchange Commission v. Cheryl R. Kramer, No. 1:26-cv-03786 (D. Maryland filed Sept. 24, 2026)

SEC Files Settled Action as to Maryland Resident for Alleged Insider Trading in Massachusetts-Based Biopharmaceutical Company

On September 24, 2026, the Securities and Exchange Commission filed a settled insider trading action as to Maryland resident Cheryl Kramer, who allegedly avoided losses by trading ahead of negative news announced by Cambridge, Massachusetts-based biopharmaceutical company, Sage Therapeutics, Inc.

According to the SEC's complaint, filed in the U.S. District Court for the District of Maryland, in June 2023, Kramer owed a duty of trust and confidence to a Sage insider who learned material non-public information regarding the FDA's position on Sage's application for approval of its drug for the treatment of major depressive disorder (MDD). The SEC alleged that in the days leading up to Kramer's trade, the insider learned that the FDA had struck MDD entirely from the proposed label listing approved uses of the drug, attended at least one meeting about the FDA's comments regarding the proposed label, and received instructions to keep the information closely held. As alleged, Kramer learned non-public information regarding the FDA's position on Sage's application from the insider and then-in advance of Sage's August 4, 2023 announcement that the FDA had denied approval of Sage's primary drug candidate for the treatment of MDD-liquidated all the Sage shares she held, some of which she had held for over a year. The SEC alleges that Kramer avoided losses of approximately $11,140 when Sage's share price dropped 53% following the announcement.

Without admitting the Commission's allegations, Kramer consented to the entry of a final judgment, subject to court approval, which would permanently enjoin her from violating Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; and order her to pay disgorgement of $11,139.60, prejudgment interest of $2,416.61, and a civil penalty of $11,139.60.

The SEC's investigation was conducted by Cassandra Arriaza, Jeffrey Cook, and J. Martin Shanahan, under the supervision of Celia Moore of the SEC's Boston Regional Office. The SEC appreciates the assistance of the Financial Industry Regulatory Authority.