Brilliant Stanford geneticist, 87, ordered to pay $29m to friend who invested in fake miracle cure

A world-renowned geneticist and Stanford University professor has paid $29 million in fines after duping his friends into investing in his 'miracle cure' for Huntington's disease.

Professor Stanley Cohen, 87, was found to have committed 'a species of actual fraud and…deceit' in misleading investors into a biotechnology company he founded in 2016, in a case which bears strong parallels to that of Stanford dropout Elizabeth Holmes.

Holmes was in November sentenced to 11 years in federal prison after a jury convicted her of defrauding investors through her former blood-testing company, Theranos.

Cohen's company, Nuredis, offered not blood testing but a cure for the fatal degenerative disease Huntington's.

Huntington's is a rare, inherited disease that causes the progressive degeneration of nerve cells in the brain, leading to mood changes, anxiety and depression. It affects around 41,000 Americans, according to the Huntington's Disease Society of America. There is no cure.

Cohen, the first geneticist to transplant genes from one living organism to another, encouraged longtime family friend and biotech investor Christopher Alafi to invest $20 million in Nuredis, promising that the company was pioneering revolutionary work.

But Cohen failed to tell Alafi that the drug had been withdrawn by the FDA in 1976 for its 'potentially deadly side effects'.

It was placed on the 'DO NOT COMPOUND' list, after causing the loss of limbs, and death.

In October 2018, Alafi sued Cohen for fraud, seeking the return of his investment plus interest.

Michael Gardener, Alafi's lawyer, said that the case was extremely painful for Alafi, because it marked a total collapse of their decades-long friendship.

'They live near each other…their families socialized with each other, they went to Yom Kippur services together, they visited each other in the hospital,' Gardener said.

'I mean everyone relied on [Cohen] because he was such a close family friend and because this was a world renowned scientist, so when he tells you something, you tend to believe that.'

Cohen, who until recently lived in a spectacular bungalow in Portola Valley, in the San Francisco Bay area, swore under oath that he had told Alafi of the FDA warnings.

But, under cross examination during his trial, he admitted he had not.

Judge Beth McGowen ruled last month that Cohen should pay Alafi $29 million, after a June 25 ruling against him.

She declared, according to Stanford Daily, that Cohen was 'not credible' and his 'testimony at times was inconsistent, confusing, and unreliable.'

Cohen remains employed by Stanford University - despite one senior professor telling The Stanford Daily: 'the saga does indeed read like a stain on the University.'

A spokesman initially told the paper that they were unaware of the case, but then revised their statement to admit they have known for some years.

University spokesperson Dee Mostofi initially said they did not know about the scandal, and wrote in a statement: 'Activity related to [the since-dissolved venture] would have been outside of Professor Cohen's responsibilities at Stanford.'

Stanford was subpoenaed in the case early on in the 2018 suit.

Earlier this month, another spokesperson, Luisa Rapport, confirmed that the University had, indeed, known about the case.

She 'apologize[d] for the error' and wrote that '​​the university does respond to many subpoenas related to lawsuits in which Stanford is not a party.'

But she would not comment on Cohen's continued employment.

He has not commented on the case.