SEC v. Maurizio Chiriva-Internati, No. 4:24-cv-04729, Southern District of Texas (Dec. 3, 2024) — Complaint

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION

SECURITIES AND EXCHANGE
COMMISSION,

           Plaintiff,
 Cause No.: 4:24-cv-4729
v.

MAURIZIO CHIRIVA-INTERNATI,

          Defendant.

COMPLAINT

 Plaintiff Securities and Exchange Commission (“Commission” or “SEC”) files this
Complaint against Defendant Maurizio Chiriva-Internati (“Chiriva” or “Defendant”) and alleges
as follows:
SUMMARY
1.  Kiromic BioPharma, Inc. (“Kiromic”) is a publicly traded biotherapeutics
company in Houston that aims to develop and commercialize cell therapies that focus on
immuno-oncology.  Approximately two weeks before Kiromic raised $40 million through a public
offering of company stock on July 2, 2021 (the “Offering”), the U.S. Food and Drug
Administration (“FDA”) notified Kiromic that it had placed clinical holds on two Investigational
New Drug (“IND”) applications that Kiromic filed in May 2021.  However, in public statements
and reports filed with the SEC both before and after the Offering, Kiromic made materially false
and misleading statements and omissions concerning the status of the FDA’s review of the INDs
and the existence of the clinical holds.

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2. On June 25, 2021, Chiriva, as Kiromic’s Chief Executive Officer (“CEO”), signed
and approved an SEC filing—registering the shares Kiromic sold through the Offering—that
contained materially false and misleading statements and omissions.  In addition, Chiriva failed
to correct misstatements to investors Kiromic officers made on investor roadshow calls prior to
the Offering.  Finally, Chiriva signed and certified a materially misleading Form 10-Q that
Kiromic filed on August 13, 2021 for the fiscal quarter ended June 30, 2021.
3. Based on the foregoing conduct, and the conduct described herein below, Chiriva
violated Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 (“Securities Act”) and Rule
13a-14 of the Securities Exchange Act of 1934 (“Exchange Act”), and aided and abetted
Kiromic’s violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-
15(a) thereunder.
JURISDICTION AND VENUE
4. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and
22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e),
and 27(a) of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa(a)].  Defendant directly or
indirectly made use of the means or instrumentalities of interstate commerce, or of the mails, or
the facilities of a national securities exchange, in connection with the transactions, acts,
practices, and courses of business alleged herein.
5. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)].  Certain of the
transactions, acts, practices, and courses of business constituting violations of the federal
securities laws alleged herein occurred within this district.

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DEFENDANT
6. Chiriva, age 56, resides in Manvel, Texas.  Chiriva was born in Italy and speaks
English as a second language.  He is the co-founder and former CEO and Board Chairman of
Kiromic, and prior to those roles was Kiromic’s Chief Scientific Officer.  Chiriva holds a Ph.D. in
morphological sciences and a PH.D. in immunology.
RELATED ENTITY
7. Kiromic BioPharma, Inc. is a Delaware corporation formed in 2016 with its
principal place of business in Houston, Texas.  Kiromic’s common stock was previously registered
with the Commission under Section 12(b) of the Exchange Act and is currently registered under
Section 12(g) of the Exchange Act.
FACTUAL ALLEGATIONS
I.         The ALEXIS INDs and FDA Clinical Holds

8. At all times between May 2021 and February 2022, Kiromic was a pre-revenue
company with no approved, commercial products for sale.  In May 2021, Kiromic announced via
press releases that it had submitted novel Investigational New Drug (“IND”) applications to the
FDA for its cancer product candidates, ALEXIS-PRO-1 and ALEXIS-ISO-1 (collectively, the
“ALEXIS INDs”).  Other than the ALEXIS INDs, Kiromic had no other product candidates in its
pipeline.  In its May 2021 press releases, Kiromic stated that “FDA feedback [was] expected
within 30 days” before the company could begin clinical trials in “Q3 2021.”
9. Per FDA regulations, “[a]n IND goes into effect: Thirty days after FDA receives
the IND, unless FDA notifies the sponsor that the investigations described in the IND are subject
to a clinical hold . . . .” 21 C.F.R. § 312.40(b)(1).  “A clinical hold is an order issued by FDA to
the [IND] sponsor to delay a proposed clinical investigation.”  21 C.F.R. § 312.42(a).  “The

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clinical hold order may be made by telephone or other means of rapid communication [such as
email] or in writing.” 21 C.F.R. § 312.42(d).  Once an IND is placed on clinical hold, an IND
sponsor must first correct the deficiencies that the FDA cited before the agency will remove a
clinical hold.  21 C.F.R. § 312.42(e).
A. The FDA imposed clinical holds on Kiromic’s ALEXIS INDs in June 2021.
10. On June 16, 2021, the FDA contacted Kiromic’s then-Chief Medical Officer
(“CMO”) via telephone to inform him that the FDA placed Kiromic’s ALEXIS-PRO-1 IND on
clinical hold.  That same day, the FDA also sent Kiromic’s CMO a confirmatory email stating
that Kiromic’s ALEXIS-PRO-1 had “been placed on clinical hold” because a section of the
submission was “grossly deficient” and because the lack of information about certain factors,
such as manufacturing and testing, prevented the FDA from assessing the risk of the product.
The FDA also informed Kiromic in the email that a formal “clinical hold letter w[ould] be issued
to [Kiromic] by July 16, 2021.”
11. A formal clinical hold letter explains the FDA’s basis and reasoning for the hold.
12. Later in the afternoon of June 16, 2021, the CMO informed Chiriva of the FDA’s
clinical hold on the ALEXIS-PRO-1.  The CMO also forwarded to Chiriva the FDA’s June 16,
2021 clinical hold email.  Chiriva reviewed the FDA’s June 16, 2021 email and understood that
“clinical hold” meant that the FDA did not authorize the continuation of this IND.
13. The next day, on June 17, 2021, the FDA informed the CMO via telephone that
the FDA had similarly placed Kiromic’s second IND, the ALEXIS-ISO, on clinical hold.  The
CMO relayed to Chiriva the clinical hold on the ALEXIS-ISO IND via telephone that same day.
14. On June 17, 2021, the CMO sent Chiriva an email recommending that Kiromic
promptly disclose the clinical holds.

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15. In a reply email, Chiriva said that he agreed.
B. Chiriva updated Kiromic’s Board about the FDA communications.

16. On June 18, 2021, a Kiromic Board member asked Chiriva via text message (in
Italian): “[w]hat did the FDA say about the first IND? It’s ok, it’s not so bad, or did they raise
issues?”  Chiriva responded, “[w]e are waiting but [the FDA is] asking more information so at
this moment we are not authorized to do anything until we will address secondary level of
questions that will arrive by July 15.”
17. The 30-day window the FDA had to review the INDs elapsed on June 16 for the
ALEXIS PRO and June 20 for the ALEXIS ISO.
18. On June 22, 2021, Chiriva convened a virtual meeting of Kiromic’s Board of
Directors via conference call to discuss, among other things, Kiromic’s communications with the
FDA regarding the ALEXIS INDs.  The CMO, a non-Board member, and Kiromic’s legal
counsel also attended the virtual meeting.
19. Chiriva is not a native English speaker, and his messaging to the Board about the
FDA’s communications about the status of the ALEXIS INDs was imprecise.  Chiriva told the
Board that: Kiromic had received communications from the FDA about the ALEXIS INDs; the
FDA had requested an additional 30 days to conduct a secondary review; and the IND
applications were on halt and administratively on hold until Kiromic received further questions
from the FDA.  While Chiriva told the Board that the CMO was involved in the meeting to give
more specifics if there were any questions, the Board did not ask questions of Chiriva or anyone
else on this issue, and Chiriva did not ask questions of the Board or anyone else.
20. Some attendees at the meeting, including members of the Board, did not
understand from Chiriva’s update that the FDA had already imposed clinical holds on the

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ALEXIS INDs.  Rather, they understood—from Chiriva’s comments about the FDA’s secondary
review and further questions expected in another 30 days—that the FDA was still reviewing the
ALEXIS INDs and had not made a determination about the ALEXIS INDs.  Chiriva did not
share the June 16 email from the FDA to the CMO documenting a clinical hold with key
personnel, such as Kiromic’s then-Controller or then-CFO, who were involved in Kiromic’s
filings and statements made during the Offering.
II.  False and Misleading Statements and Omissions About the ALEXIS INDs in the
Offering, SEC Filings, and other Public Statements.

21. By July 2021, Kiromic was running out of money.  Without a capital infusion,
Kiromic only had enough cash on hand for about three and a half months before the company
would be forced to shut down.  Consequently, on July 2, 2021, Kiromic raised $40 million by
selling common stock through the Offering for the purpose of funding the company’s clinical
trials of its ALEXIS INDs.  However, Kiromic did not disclose in Kiromic’s SEC filings,
investor roadshow calls, and due diligence calls that the FDA had placed the ALEXIS INDs on
clinical hold, despite being aware of this information approximately two weeks before the
Offering began.
A. Kiromic made material omissions related to the FDA clinical holds
in its Form S-1 and final prospectus.

22. Kiromic filed a Form S-1 on June 25, 2021, and a final prospectus on June 30,
2021, both of which were materially false and misleading because they discussed the clinical
trial plan for the ALEXIS INDs and the hypothetical risk that the FDA could issue a clinical hold
but omitted that the FDA had actually placed the ALEXIS INDs on clinical holds.  This
information was important to, among other things, the company’s projected clinical trial timeline
of “third quarter of 2021.”

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23. Instead, Kiromic stated in both filings only that its “two product candidates . . .
ALEXIS-ISO-1 and ALEXIS-PRO-1 . . . are in the pre-initial new drug (‘IND’) stages of the
[FDA] clinical trial process.  We are currently going through the IND enabling trials process and
we expect that first in human dosing in Phase I of clinical trials will commence in the third
quarter of 2021.”
24. In its risk factors in both the Form S-1 and the final prospectus, Kiromic stated
(emphasis added):
If the FDA imposes a clinical hold, trials may not recommence without FDA
authorization and then only under terms authorized by the FDA.  Accordingly, we
cannot be sure that submission of an IND will result in the FDA allowing clinical
trials to begin, or that, once begun, issues will not arise that suspend or terminate
such trials.

25. Despite disclosing the hypothetical risk of a clinical hold and the potential
negative consequences on Kiromic’s business, Kiromic failed to disclose the material
information that the FDA had already issued clinical holds on the ALEXIS INDs.
26. Chiriva reviewed, signed, and contributed content to the Form S-1, including
information about the FDA clinical trials timelines.
27. As CEO and Board Chairman, and as someone who knew of the FDA clinical
holds, Chiriva knew or should have known that Kiromic omitted the FDA clinical holds before
he signed Kiromic’s Form S-1.
B. Kiromic made false and misleading statements and omissions related to the
FDA clinical holds to prospective investors during its investor roadshow calls.

28. On June 28 and 29, 2021, just days before the Offering, Kiromic’s officers
participated in at least ten investor roadshow calls and failed to inform potential investors that
the FDA had placed the ALEXIS INDs on clinical holds.  Chiriva participated in some but not all
of these investor roadshow calls.  Kiromic’s CFO was primarily responsible for speaking during

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these calls.  During one investor call, the CFO stated the following about the FDA’s review of
Kiromic’s INDs:
So the two INDs were filed on the 24th of May, and now we are at the end of
June.  The normal calendar is 30 to 60 days to get a reply back from the FDA,
and they tell us that we are authorized to begin our first in human [trials].  So I
do believe that within July we should be any days being able to hear back.
Our confidence in it going through is very high...[S]o we do believe that our
chances of getting FDA authorization is very good.  Within this July we will
hear about that.

29. Chiriva attended this June 29, 2021 investor call, and he knew that the FDA had
placed the ALEXIS INDs on clinical holds nearly two weeks earlier.  Despite this knowledge,
Chiriva did not correct the CFO’s misstatement by disclosing the clinical holds.  On certain other
investor calls on June 28 and 29, the CFO made similar false and misleading statements or
omissions, and Chiriva did not correct the CFO’s statements by disclosing the clinical holds.
C. Kiromic made false and misleading statements and omissions related to the
FDA clinical holds during due diligence calls with its underwriters, lawyers,
and auditors.

30. In preparation for the Offering, Kiromic participated in due diligence calls with its
underwriters, lawyers, and auditors (“external participants”), during which Kiromic did not
disclose that the FDA had placed the INDs on clinical hold.  Some due diligence questions asked
about upcoming announcements and the timeline of the first in-human dosing for the ALEXIS
INDs, indicating that Kiromic’s underwriters viewed the FDA’s response to Kiromic’s IND
applications—and the effect on the clinical trials timeline—as significant information.
31. For example, the underwriters were particularly interested in when Kiromic
would receive the FDA’s authorization to begin clinical trials, because this was considered a
very strong selling point for the Offering.  Kiromic’s officers, including Chiriva on at least one
occasion, participated in discussions in which the underwriters expressed that the clinical trials

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timeline was the most important component of the Offering.
32. On June 17, 2021, one day after the FDA informed Kiromic about the clinical
hold on the ALEXIS-PRO-1, Chiriva and the CFO participated in a “Management Due Diligence
Call.”  On behalf of Kiromic, the CFO answered questions regarding the clinical trials timeline
and did not disclose the clinical holds.  Instead, the CFO told the external participants that
Kiromic was waiting on the FDA’s authorization to begin clinical trials.  During the call, Chiriva
did not correct the CFO’s misleading statements or omissions by disclosing the clinical holds.
III. False and Misleading Statements Related to the Clinical-Hold Communications in
Kiromic’s Form 10-Q.

A.  The FDA’s July 13 Clinical Hold Letters

33. On July 13, 2021, Kiromic received the detailed FDA clinical-hold letters for the
ALEXIS INDs, which explained the FDA’s reasons for issuing the June 16 and 17 clinical holds.
Further, the letters made clear that the FDA originally communicated the clinical holds by
telephone on June 16 and 17.  That same day, the CFO reviewed the letters.  The next day, the
CFO urged Kiromic to make prompt disclosure of the clinical holds.  The Kiromic Board
subsequently discussed the letters and approved a press release.
34. On July 16, 2021, Kiromic issued a press release (but not a Form 8-K) stating that
the “FDA returned with comments” (emphasis added) regarding the INDs and that Kiromic still
expected to meet its third quarter 2021 clinical trials timeline.  Kiromic’s July 16 press release
did not use the term “clinical hold.”
35. This July 16 press release was associated with Kiromic’s stock price dropping by
an abnormal 16.36%, eliminating roughly $9.7M in market capitalization.
B.  Kiromic’s False and Misleading Form 10-Q
36. On August 13, 2021, Kiromic filed its Form 10-Q for the period ended June 30,

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2021, which failed to disclose that the FDA had placed the ALEXIS INDs on clinical holds.  The
Form 10-Q stated that the ALEXIS INDs “are in the pre-initial new drug (“IND”) stages of the
[FDA] clinical trial process.  We are currently going through the IND enabling trials process and
we expect that first in human dosing in Phase I of clinical trials will commence in the first
quarter of 2022.”
37. Under the heading “Recent Developments” in the Form 10-Q, Kiromic discussed
the submission of the INDs to the FDA in May 2021, but omitted the FDA’s June and July
clinical-hold communications.
38. As CEO, Chiriva signed and certified Kiromic’s Form 10-Q, despite these false
and misleading statements and omissions.
39. On August 13, 2021, Kiromic issued a press release (and a Form 8-K),
announcing that it had applied for “a Type A meeting with the FDA...[to] address the clinical
hold issues and...discuss [a] path toward our first-in-human dosing” (emphasis added).  This was
Kiromic’s first public reference to the FDA’s “clinical hold[s]” on the ALEXIS INDs.
IV. Kiromic’s Subsequent Actions

40. In August 2021, after Kiromic filed its Form 10-Q, the company received two
complaints, via the company’s anonymous hotline, alleging risks associated with Kiromic’s
public disclosures in its SEC filings and statements made to the public related to the anticipated
timing of FDA authorization of Kiromic’s INDs and projected clinical trials start date.
41. Kiromic’s Board of Directors formed a Special Committee comprised only of
independent directors of the Board and engaged outside counsel to conduct an internal
investigation into the anonymous complaints (the “Investigation”).  The Investigation found that
Kiromic had received FDA clinical-hold communications on June 16 and 17, 2021, and that

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Kiromic raised $40 million in the Offering without disclosing the June FDA clinical-hold
communications in its Form S-1, final prospectus, or Form 10-Q for the period ended June 30,
2021.
42. Following the Investigation, Kiromic undertook several remedial measures to
improve the effectiveness of the company’s disclosure controls and procedures and filed a Form
8-K in which it acknowledged that it had failed to timely disclose the FDA communications.
The 8-K also stated that the company terminated Chiriva for cause.
CLAIMS FOR RELIEF
First Claim
Chiriva Violated Sections 17(a)(2) and 17(a)(3) of the Securities Act
[15 U.S.C. §§ 77q(a)(2) and (a)(3)]

43. Plaintiff re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
44. By engaging in the conduct described herein, Chiriva, directly or indirectly, in the
offer or sale of a security, by the use of the means or instruments of transportation or
communication in interstate commerce or by use of the mails: obtained money or property by
means of an untrue statement of a material fact or an omission to state a material fact necessary
in order to make the statements made, in light of the circumstances under which they were made,
not misleading; and/or engaged in a transaction, practice, or course of business which operated or
would operate as a fraud or deceit upon the purchaser.
45. Chiriva was at least negligent in his conduct alleged herein.
46. For these reasons, Chiriva violated, and unless enjoined will continue to violate,
Sections 17(a)(2) and (3) of the Securities Act [15 U.S.C. §§ 77q(a)(2) and (3)].

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Second Claim
Chiriva Violated Exchange Act Rule 13a-14
[17 C.F.R. § 240.13a-14]

47. Plaintiff re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
48. On August 13, 2021, acting under Section 302 of the Sarbanes-Oxley Act of 2002
and Exchange Act Rule 13a-14, Chiriva certified a quarterly report filed with the SEC by
Kiromic.
49. By engaging in the acts and conduct alleged herein, Chiriva filed or caused to be
filed on Kiromic’s behalf a quarterly report on Form 10-Q that contained certifications signed by
Chiriva as Kiromic’s principal executive officer pursuant to Exchange Act Rule 13a-14 and
included untrue statements of material fact, or failed to include, in addition to the information
required to be stated in such certification, such further material information as was necessary to
make the required statements, in light of the circumstances under which they were made, not
misleading, or failed to disclose information required to be disclosed therein..
50. By reason of the foregoing, Chiriva violated, and unless enjoined will continue to
violate, Exchange Act Rule 13a-14.
Third Claim
Chiriva Aided and Abetted Kiromic’s Violations of Section 13(a) of the Exchange Act
[15 U.S.C. § 78m(a)] and Rules 12b-20, 13a-13, and 13a-15(a) thereunder
[17 C.F.R. §§ 240.12b-20, 240.13a-13, and 13a-15(a)]

51. Plaintiff re-alleges and incorporates by reference each and every allegation
contained in the paragraphs above.
52. Kiromic is an issuer of securities registered under Section 12 of the Exchange Act
that filed required reports with the SEC under Section 13(a) of the Exchange Act and related

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rules and regulations.
53. By engaging in the conduct described above, Kiromic: failed to file a quarterly
report with the SEC that was true and correct; failed to include material information in its
required report as was necessary to make the statements made, in light of the circumstances
under which they were made, not misleading; and failed to maintain disclosure controls and
procedures.
54. By engaging in the acts and conduct alleged herein, Kiromic violated Section
13(a) of the Exchange Act and Exchange Act Rules 12b-20, 13a-13, and 13a-15(a) thereunder.
Kiromic has consented to the entry of an SEC Order Instituting Cease-and-Desist Proceedings
Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of the Securities Exchange
Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order (“OIP”), finding, among
other things, that Kiromic violated Section 13(a) of the Exchange Act and Exchange Act Rules
12b-20, 13a-13, and 13a-15(a) thereunder.
55. Chiriva, acting with the requisite state of mind, provided substantial assistance to
Kiromic in committing its violations of Section 13(a) of the Exchange Act and Exchange Act
Rules 12b-20, 13a-13, and 13a-15(a) thereunder.
56. By reason of the foregoing, Chiriva aided and abetted Kiromic’s violations of
Section 13(a) of the Exchange Act and Exchange Act Rules 12b-20, 13a-13, and 13a-15(a)
thereunder and, unless enjoined, will continue to aid and abet such violations.
PRAYER FOR RELIEF

THEREFORE, the SEC respectfully requests that the Court:
(1) Permanently enjoin Chiriva from violating Sections 17(a)(2) and (3) of the
Securities Act and Rule 13a-14 of the Exchange Act, and from aiding and abetting violations of

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Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-15(a) thereunder;
(2) Order Chiriva to pay a civil penalty pursuant to Section 20(d) of the Securities
Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)];
(3)   Bar Chiriva from acting as an officer or director of any issuer that has a class of
securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] or that is
required to file reports pursuant to Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)]; and
 (4) Grant such other and further relief as the Court may deem just and proper.
Dated:    December 3, 2024                         Respectfully            submitted,

      s/ Jennifer D. Reece
                                                                        Jennifer            D.            Reece
      Attorney-in-Charge
                                                                        S.D.            Texas            Bar            No.            37943
Texas Bar No. 00796242
                                                                        United            States            Securities            and            Exchange            Commission
                                                                        801            Cherry            Street,            Suite            1900
                                                                        Fort            Worth,            Texas            76102
                                                                        Direct            phone:            (817)            978-6442
                                                                        Fax:            (817)            978-4927
      [email protected]

                                                                        ATTORNEY            FOR            PLAINTIFF
      SECURITIES AND EXCHANGE COMMISSION

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UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF TEXAS 

HOUSTON DIVISION 
 
  
SECURITIES AND EXCHANGE 
COMMISSION, 

 

  
           Plaintiff,  
 Cause No.: 4:24-cv-4729  
v.  
  
MAURIZIO CHIRIVA-INTERNATI,  
     

 

          Defendant.   
 

 
COMPLAINT 

 
 Plaintiff Securities and Exchange Commission (“Commission” or “SEC”) files this 

Complaint against Defendant Maurizio Chiriva-Internati (“Chiriva” or “Defendant”) and alleges 

as follows: 

SUMMARY 

1.  Kiromic BioPharma, Inc. (“Kiromic”) is a publicly traded biotherapeutics 

company in Houston that aims to develop and commercialize cell therapies that focus on 

immuno-oncology.  Approximately two weeks before Kiromic raised $40 million through a public 

offering of company stock on July 2, 2021 (the “Offering”), the U.S. Food and Drug 

Administration (“FDA”) notified Kiromic that it had placed clinical holds on two Investigational 

New Drug (“IND”) applications that Kiromic filed in May 2021.  However, in public statements 

and reports filed with the SEC both before and after the Offering, Kiromic made materially false 

and misleading statements and omissions concerning the status of the FDA’s review of the INDs 

and the existence of the clinical holds.   

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2. On June 25, 2021, Chiriva, as Kiromic’s Chief Executive Officer (“CEO”), signed 

and approved an SEC filing—registering the shares Kiromic sold through the Offering—that 

contained materially false and misleading statements and omissions.  In addition, Chiriva failed 

to correct misstatements to investors Kiromic officers made on investor roadshow calls prior to 

the Offering.  Finally, Chiriva signed and certified a materially misleading Form 10-Q that 

Kiromic filed on August 13, 2021 for the fiscal quarter ended June 30, 2021.   

3. Based on the foregoing conduct, and the conduct described herein below, Chiriva 

violated Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 (“Securities Act”) and Rule 

13a-14 of the Securities Exchange Act of 1934 (“Exchange Act”), and aided and abetted 

Kiromic’s violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-

15(a) thereunder. 

JURISDICTION AND VENUE 

4. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and 

22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e), 

and 27(a) of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa(a)].  Defendant directly or 

indirectly made use of the means or instrumentalities of interstate commerce, or of the mails, or 

the facilities of a national securities exchange, in connection with the transactions, acts, 

practices, and courses of business alleged herein.   

5. Venue is proper in this district pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)].  Certain of the 

transactions, acts, practices, and courses of business constituting violations of the federal 

securities laws alleged herein occurred within this district.     

 

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DEFENDANT 

6. Chiriva, age 56, resides in Manvel, Texas.  Chiriva was born in Italy and speaks 

English as a second language.  He is the co-founder and former CEO and Board Chairman of 

Kiromic, and prior to those roles was Kiromic’s Chief Scientific Officer.  Chiriva holds a Ph.D. in 

morphological sciences and a PH.D. in immunology.     

RELATED ENTITY 

7. Kiromic BioPharma, Inc. is a Delaware corporation formed in 2016 with its 

principal place of business in Houston, Texas.  Kiromic’s common stock was previously registered 

with the Commission under Section 12(b) of the Exchange Act and is currently registered under 

Section 12(g) of the Exchange Act.   

FACTUAL ALLEGATIONS 

I.      The ALEXIS INDs and FDA Clinical Holds   
 

8. At all times between May 2021 and February 2022, Kiromic was a pre-revenue 

company with no approved, commercial products for sale.  In May 2021, Kiromic announced via 

press releases that it had submitted novel Investigational New Drug (“IND”) applications to the 

FDA for its cancer product candidates, ALEXIS-PRO-1 and ALEXIS-ISO-1 (collectively, the 

“ALEXIS INDs”).  Other than the ALEXIS INDs, Kiromic had no other product candidates in its 

pipeline.  In its May 2021 press releases, Kiromic stated that “FDA feedback [was] expected 

within 30 days” before the company could begin clinical trials in “Q3 2021.”   

9. Per FDA regulations, “[a]n IND goes into effect: Thirty days after FDA receives 

the IND, unless FDA notifies the sponsor that the investigations described in the IND are subject 

to a clinical hold . . . .” 21 C.F.R. § 312.40(b)(1).  “A clinical hold is an order issued by FDA to 

the [IND] sponsor to delay a proposed clinical investigation.”  21 C.F.R. § 312.42(a).  “The 

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clinical hold order may be made by telephone or other means of rapid communication [such as 

email] or in writing.” 21 C.F.R. § 312.42(d).  Once an IND is placed on clinical hold, an IND 

sponsor must first correct the deficiencies that the FDA cited before the agency will remove a 

clinical hold.  21 C.F.R. § 312.42(e).  

A. The FDA imposed clinical holds on Kiromic’s ALEXIS INDs in June 2021. 

10. On June 16, 2021, the FDA contacted Kiromic’s then-Chief Medical Officer 

(“CMO”) via telephone to inform him that the FDA placed Kiromic’s ALEXIS-PRO-1 IND on 

clinical hold.  That same day, the FDA also sent Kiromic’s CMO a confirmatory email stating 

that Kiromic’s ALEXIS-PRO-1 had “been placed on clinical hold” because a section of the 

submission was “grossly deficient” and because the lack of information about certain factors, 

such as manufacturing and testing, prevented the FDA from assessing the risk of the product.  

The FDA also informed Kiromic in the email that a formal “clinical hold letter w[ould] be issued 

to [Kiromic] by July 16, 2021.”  

11. A formal clinical hold letter explains the FDA’s basis and reasoning for the hold. 

12. Later in the afternoon of June 16, 2021, the CMO informed Chiriva of the FDA’s 

clinical hold on the ALEXIS-PRO-1.  The CMO also forwarded to Chiriva the FDA’s June 16, 

2021 clinical hold email.  Chiriva reviewed the FDA’s June 16, 2021 email and understood that 

“clinical hold” meant that the FDA did not authorize the continuation of this IND. 

13. The next day, on June 17, 2021, the FDA informed the CMO via telephone that 

the FDA had similarly placed Kiromic’s second IND, the ALEXIS-ISO, on clinical hold.  The 

CMO relayed to Chiriva the clinical hold on the ALEXIS-ISO IND via telephone that same day.   

14. On June 17, 2021, the CMO sent Chiriva an email recommending that Kiromic 

promptly disclose the clinical holds.   

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15. In a reply email, Chiriva said that he agreed.  

B. Chiriva updated Kiromic’s Board about the FDA communications.  
 
16. On June 18, 2021, a Kiromic Board member asked Chiriva via text message (in 

Italian): “[w]hat did the FDA say about the first IND? It’s ok, it’s not so bad, or did they raise 

issues?”  Chiriva responded, “[w]e are waiting but [the FDA is] asking more information so at 

this moment we are not authorized to do anything until we will address secondary level of 

questions that will arrive by July 15.”   

17. The 30-day window the FDA had to review the INDs elapsed on June 16 for the 

ALEXIS PRO and June 20 for the ALEXIS ISO. 

18. On June 22, 2021, Chiriva convened a virtual meeting of Kiromic’s Board of 

Directors via conference call to discuss, among other things, Kiromic’s communications with the 

FDA regarding the ALEXIS INDs.  The CMO, a non-Board member, and Kiromic’s legal 

counsel also attended the virtual meeting. 

19. Chiriva is not a native English speaker, and his messaging to the Board about the 

FDA’s communications about the status of the ALEXIS INDs was imprecise.  Chiriva told the 

Board that: Kiromic had received communications from the FDA about the ALEXIS INDs; the 

FDA had requested an additional 30 days to conduct a secondary review; and the IND 

applications were on halt and administratively on hold until Kiromic received further questions 

from the FDA.  While Chiriva told the Board that the CMO was involved in the meeting to give 

more specifics if there were any questions, the Board did not ask questions of Chiriva or anyone 

else on this issue, and Chiriva did not ask questions of the Board or anyone else.   

20. Some attendees at the meeting, including members of the Board, did not 

understand from Chiriva’s update that the FDA had already imposed clinical holds on the 

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ALEXIS INDs.  Rather, they understood—from Chiriva’s comments about the FDA’s secondary 

review and further questions expected in another 30 days—that the FDA was still reviewing the 

ALEXIS INDs and had not made a determination about the ALEXIS INDs.  Chiriva did not 

share the June 16 email from the FDA to the CMO documenting a clinical hold with key 

personnel, such as Kiromic’s then-Controller or then-CFO, who were involved in Kiromic’s 

filings and statements made during the Offering.  

II.  False and Misleading Statements and Omissions About the ALEXIS INDs in the 
Offering, SEC Filings, and other Public Statements. 

 
21. By July 2021, Kiromic was running out of money.  Without a capital infusion, 

Kiromic only had enough cash on hand for about three and a half months before the company 

would be forced to shut down.  Consequently, on July 2, 2021, Kiromic raised $40 million by 

selling common stock through the Offering for the purpose of funding the company’s clinical 

trials of its ALEXIS INDs.  However, Kiromic did not disclose in Kiromic’s SEC filings, 

investor roadshow calls, and due diligence calls that the FDA had placed the ALEXIS INDs on 

clinical hold, despite being aware of this information approximately two weeks before the 

Offering began.  

A. Kiromic made material omissions related to the FDA clinical holds  
in its Form S-1 and final prospectus. 
 

22. Kiromic filed a Form S-1 on June 25, 2021, and a final prospectus on June 30, 

2021, both of which were materially false and misleading because they discussed the clinical 

trial plan for the ALEXIS INDs and the hypothetical risk that the FDA could issue a clinical hold 

but omitted that the FDA had actually placed the ALEXIS INDs on clinical holds.  This 

information was important to, among other things, the company’s projected clinical trial timeline 

of “third quarter of 2021.”   

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23. Instead, Kiromic stated in both filings only that its “two product candidates . . . 

ALEXIS-ISO-1 and ALEXIS-PRO-1 . . . are in the pre-initial new drug (‘IND’) stages of the 

[FDA] clinical trial process.  We are currently going through the IND enabling trials process and 

we expect that first in human dosing in Phase I of clinical trials will commence in the third 

quarter of 2021.” 

24. In its risk factors in both the Form S-1 and the final prospectus, Kiromic stated 

(emphasis added): 

If the FDA imposes a clinical hold, trials may not recommence without FDA 
authorization and then only under terms authorized by the FDA.  Accordingly, we 
cannot be sure that submission of an IND will result in the FDA allowing clinical 
trials to begin, or that, once begun, issues will not arise that suspend or terminate 
such trials.  
  
25. Despite disclosing the hypothetical risk of a clinical hold and the potential 

negative consequences on Kiromic’s business, Kiromic failed to disclose the material 

information that the FDA had already issued clinical holds on the ALEXIS INDs. 

26. Chiriva reviewed, signed, and contributed content to the Form S-1, including 

information about the FDA clinical trials timelines.   

27. As CEO and Board Chairman, and as someone who knew of the FDA clinical 

holds, Chiriva knew or should have known that Kiromic omitted the FDA clinical holds before 

he signed Kiromic’s Form S-1.   

B. Kiromic made false and misleading statements and omissions related to the 
FDA clinical holds to prospective investors during its investor roadshow calls. 

 
28. On June 28 and 29, 2021, just days before the Offering, Kiromic’s officers 

participated in at least ten investor roadshow calls and failed to inform potential investors that 

the FDA had placed the ALEXIS INDs on clinical holds.  Chiriva participated in some but not all 

of these investor roadshow calls.  Kiromic’s CFO was primarily responsible for speaking during 

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these calls.  During one investor call, the CFO stated the following about the FDA’s review of 

Kiromic’s INDs: 

So the two INDs were filed on the 24th of May, and now we are at the end of 
June.  The normal calendar is 30 to 60 days to get a reply back from the FDA, 
and they tell us that we are authorized to begin our first in human [trials].  So I 
do believe that within July we should be any days being able to hear back.  
Our confidence in it going through is very high…[S]o we do believe that our 
chances of getting FDA authorization is very good.  Within this July we will 
hear about that. 

 
29. Chiriva attended this June 29, 2021 investor call, and he knew that the FDA had 

placed the ALEXIS INDs on clinical holds nearly two weeks earlier.  Despite this knowledge, 

Chiriva did not correct the CFO’s misstatement by disclosing the clinical holds.  On certain other 

investor calls on June 28 and 29, the CFO made similar false and misleading statements or 

omissions, and Chiriva did not correct the CFO’s statements by disclosing the clinical holds.   

C. Kiromic made false and misleading statements and omissions related to the 
FDA clinical holds during due diligence calls with its underwriters, lawyers, 
and auditors. 

 
30. In preparation for the Offering, Kiromic participated in due diligence calls with its 

underwriters, lawyers, and auditors (“external participants”), during which Kiromic did not 

disclose that the FDA had placed the INDs on clinical hold.  Some due diligence questions asked 

about upcoming announcements and the timeline of the first in-human dosing for the ALEXIS 

INDs, indicating that Kiromic’s underwriters viewed the FDA’s response to Kiromic’s IND 

applications—and the effect on the clinical trials timeline—as significant information.   

31. For example, the underwriters were particularly interested in when Kiromic 

would receive the FDA’s authorization to begin clinical trials, because this was considered a 

very strong selling point for the Offering.  Kiromic’s officers, including Chiriva on at least one 

occasion, participated in discussions in which the underwriters expressed that the clinical trials 

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timeline was the most important component of the Offering.  

32. On June 17, 2021, one day after the FDA informed Kiromic about the clinical 

hold on the ALEXIS-PRO-1, Chiriva and the CFO participated in a “Management Due Diligence 

Call.”  On behalf of Kiromic, the CFO answered questions regarding the clinical trials timeline 

and did not disclose the clinical holds.  Instead, the CFO told the external participants that 

Kiromic was waiting on the FDA’s authorization to begin clinical trials.  During the call, Chiriva 

did not correct the CFO’s misleading statements or omissions by disclosing the clinical holds.   

III. False and Misleading Statements Related to the Clinical-Hold Communications in 
Kiromic’s Form 10-Q. 

 
A.  The FDA’s July 13 Clinical Hold Letters 

 
33. On July 13, 2021, Kiromic received the detailed FDA clinical-hold letters for the 

ALEXIS INDs, which explained the FDA’s reasons for issuing the June 16 and 17 clinical holds.  

Further, the letters made clear that the FDA originally communicated the clinical holds by 

telephone on June 16 and 17.  That same day, the CFO reviewed the letters.  The next day, the 

CFO urged Kiromic to make prompt disclosure of the clinical holds.  The Kiromic Board 

subsequently discussed the letters and approved a press release.  

34. On July 16, 2021, Kiromic issued a press release (but not a Form 8-K) stating that 

the “FDA returned with comments” (emphasis added) regarding the INDs and that Kiromic still 

expected to meet its third quarter 2021 clinical trials timeline.  Kiromic’s July 16 press release 

did not use the term “clinical hold.”   

35. This July 16 press release was associated with Kiromic’s stock price dropping by 

an abnormal 16.36%, eliminating roughly $9.7M in market capitalization.   

B.  Kiromic’s False and Misleading Form 10-Q 

36. On August 13, 2021, Kiromic filed its Form 10-Q for the period ended June 30, 

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2021, which failed to disclose that the FDA had placed the ALEXIS INDs on clinical holds.  The 

Form 10-Q stated that the ALEXIS INDs “are in the pre-initial new drug (“IND”) stages of the 

[FDA] clinical trial process.  We are currently going through the IND enabling trials process and 

we expect that first in human dosing in Phase I of clinical trials will commence in the first 

quarter of 2022.”     

37. Under the heading “Recent Developments” in the Form 10-Q, Kiromic discussed 

the submission of the INDs to the FDA in May 2021, but omitted the FDA’s June and July 

clinical-hold communications.   

38. As CEO, Chiriva signed and certified Kiromic’s Form 10-Q, despite these false 

and misleading statements and omissions.   

39. On August 13, 2021, Kiromic issued a press release (and a Form 8-K), 

announcing that it had applied for “a Type A meeting with the FDA…[to] address the clinical 

hold issues and…discuss [a] path toward our first-in-human dosing” (emphasis added).  This was 

Kiromic’s first public reference to the FDA’s “clinical hold[s]” on the ALEXIS INDs. 

IV. Kiromic’s Subsequent Actions  
 
40. In August 2021, after Kiromic filed its Form 10-Q, the company received two 

complaints, via the company’s anonymous hotline, alleging risks associated with Kiromic’s 

public disclosures in its SEC filings and statements made to the public related to the anticipated 

timing of FDA authorization of Kiromic’s INDs and projected clinical trials start date.     

41. Kiromic’s Board of Directors formed a Special Committee comprised only of 

independent directors of the Board and engaged outside counsel to conduct an internal 

investigation into the anonymous complaints (the “Investigation”).  The Investigation found that 

Kiromic had received FDA clinical-hold communications on June 16 and 17, 2021, and that 

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Kiromic raised $40 million in the Offering without disclosing the June FDA clinical-hold 

communications in its Form S-1, final prospectus, or Form 10-Q for the period ended June 30, 

2021.  

42. Following the Investigation, Kiromic undertook several remedial measures to 

improve the effectiveness of the company’s disclosure controls and procedures and filed a Form 

8-K in which it acknowledged that it had failed to timely disclose the FDA communications.  

The 8-K also stated that the company terminated Chiriva for cause.   

CLAIMS FOR RELIEF 

First Claim 

Chiriva Violated Sections 17(a)(2) and 17(a)(3) of the Securities Act  
[15 U.S.C. §§ 77q(a)(2) and (a)(3)]  

 
43. Plaintiff re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

44. By engaging in the conduct described herein, Chiriva, directly or indirectly, in the 

offer or sale of a security, by the use of the means or instruments of transportation or 

communication in interstate commerce or by use of the mails: obtained money or property by 

means of an untrue statement of a material fact or an omission to state a material fact necessary 

in order to make the statements made, in light of the circumstances under which they were made, 

not misleading; and/or engaged in a transaction, practice, or course of business which operated or 

would operate as a fraud or deceit upon the purchaser. 

45. Chiriva was at least negligent in his conduct alleged herein.   

46. For these reasons, Chiriva violated, and unless enjoined will continue to violate, 

Sections 17(a)(2) and (3) of the Securities Act [15 U.S.C. §§ 77q(a)(2) and (3)].  

  

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Second Claim 

Chiriva Violated Exchange Act Rule 13a-14  
[17 C.F.R. § 240.13a-14] 

 
47. Plaintiff re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

48. On August 13, 2021, acting under Section 302 of the Sarbanes-Oxley Act of 2002 

and Exchange Act Rule 13a-14, Chiriva certified a quarterly report filed with the SEC by 

Kiromic.  

49. By engaging in the acts and conduct alleged herein, Chiriva filed or caused to be 

filed on Kiromic’s behalf a quarterly report on Form 10-Q that contained certifications signed by 

Chiriva as Kiromic’s principal executive officer pursuant to Exchange Act Rule 13a-14 and 

included untrue statements of material fact, or failed to include, in addition to the information 

required to be stated in such certification, such further material information as was necessary to 

make the required statements, in light of the circumstances under which they were made, not 

misleading, or failed to disclose information required to be disclosed therein.. 

50. By reason of the foregoing, Chiriva violated, and unless enjoined will continue to 

violate, Exchange Act Rule 13a-14. 

Third Claim 

Chiriva Aided and Abetted Kiromic’s Violations of Section 13(a) of the Exchange Act  
[15 U.S.C. § 78m(a)] and Rules 12b-20, 13a-13, and 13a-15(a) thereunder  

[17 C.F.R. §§ 240.12b-20, 240.13a-13, and 13a-15(a)] 
 

51. Plaintiff re-alleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

52. Kiromic is an issuer of securities registered under Section 12 of the Exchange Act 

that filed required reports with the SEC under Section 13(a) of the Exchange Act and related 

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rules and regulations. 

53. By engaging in the conduct described above, Kiromic: failed to file a quarterly 

report with the SEC that was true and correct; failed to include material information in its 

required report as was necessary to make the statements made, in light of the circumstances 

under which they were made, not misleading; and failed to maintain disclosure controls and 

procedures. 

54. By engaging in the acts and conduct alleged herein, Kiromic violated Section 

13(a) of the Exchange Act and Exchange Act Rules 12b-20, 13a-13, and 13a-15(a) thereunder.  

Kiromic has consented to the entry of an SEC Order Instituting Cease-and-Desist Proceedings 

Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of the Securities Exchange 

Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order (“OIP”), finding, among 

other things, that Kiromic violated Section 13(a) of the Exchange Act and Exchange Act Rules 

12b-20, 13a-13, and 13a-15(a) thereunder. 

55. Chiriva, acting with the requisite state of mind, provided substantial assistance to 

Kiromic in committing its violations of Section 13(a) of the Exchange Act and Exchange Act 

Rules 12b-20, 13a-13, and 13a-15(a) thereunder. 

56. By reason of the foregoing, Chiriva aided and abetted Kiromic’s violations of 

Section 13(a) of the Exchange Act and Exchange Act Rules 12b-20, 13a-13, and 13a-15(a) 

thereunder and, unless enjoined, will continue to aid and abet such violations. 

PRAYER FOR RELIEF 

 
THEREFORE, the SEC respectfully requests that the Court: 

(1) Permanently enjoin Chiriva from violating Sections 17(a)(2) and (3) of the 

Securities Act and Rule 13a-14 of the Exchange Act, and from aiding and abetting violations of 

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Section 13(a) of the Exchange Act and Rules 12b-20, 13a-13, and 13a-15(a) thereunder; 

(2) Order Chiriva to pay a civil penalty pursuant to Section 20(d) of the Securities 

Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)];  

(3)   Bar Chiriva from acting as an officer or director of any issuer that has a class of 

securities registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] or that is 

required to file reports pursuant to Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)]; and 

 (4) Grant such other and further relief as the Court may deem just and proper.  

Dated:    December 3, 2024   Respectfully submitted,  

            
      s/ Jennifer D. Reece                                        
      Jennifer D. Reece 
      Attorney-in-Charge 
      S.D. Texas Bar No. 37943 

Texas Bar No. 00796242 
      United States Securities and Exchange Commission  
      801 Cherry Street, Suite 1900  
      Fort Worth, Texas 76102  
      Direct phone: (817) 978-6442  
      Fax: (817) 978-4927  
      [email protected] 
 
      ATTORNEY FOR PLAINTIFF 
      SECURITIES AND EXCHANGE COMMISSION 

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