Eastman Kodak shares plummeted Monday after a federal agency put the brakes on the company’s deal to produce generic drug ingredients until “allegations of wrongdoing” are resolved, the Washington Post reported. Kodak closed yesterday at $10.52, down 29.3 percent. The stock has erased nearly 76 percent of its value since hitting $43.45 in late July. Last month, under an agreement aimed at reducing U.S. reliance on China, the U.S. International Development Finance Corporation (DFC) announced that it would give the photography pioneer a $765 million loan to retrofit its factories to make pharmaceutical ingredients. News of the deal — the first of its kind under the Defense Production Act — sent Kodak stock soaring. But last Tuesday, Sen. Elizabeth Warren (D-Mass.) asked the Securities and Exchange Commission to launch an insider trading inquiry, citing an unusually high volume of trading activity. On July 27, a day before the loan was officially announced, more than 1 million shares of Kodak stock exchanged hands, roughly quadruple its daily average, she said in a letter to SEC Chairman Jay Clayton. The stock jumped 20 percent that day, she wrote, and more than 200 percent on July 28, when the loan was announced. The DFC hit pause Friday, announcing in a tweet that it would “not proceed any further unless these allegations are cleared.”
