Questions being raised after Kodak’s stock has a big moment

This Jan. 25, 2011 file photo shows a Kodak slide projector in Philadelphia. Photography company Eastman Kodak is set to receive a $765 million government loan to create a new division that will help make ingredients for use in generic drugs. Kodak Pharmaceuticals will make critical pharmaceutical ingredients that have been identified as essential but have lapsed into chronic national shortage, as defined by the Food and Drug Administration. (AP Photo/Matt Rourke, File) This Jan. 25, 2011 file photo shows a Kodak slide projector in Philadelphia. Photography company Eastman Kodak is set to receive a $765 million government loan to create a new division that will help make ingredients for use in generic drugs. Kodak Pharmaceuticals will make critical pharmaceutical ingredients that have been identified as essential but have lapsed into chronic national shortage, as defined by the Food and Drug Administration. (AP Photo/Matt Rourke, File)

By MICHAEL LIEDTKE / AP Business Writer August 5, 2020 3 min read

Eastman Kodak’s potentially lucrative deal to help the U.S. government make more generic drugs domestically is threatening to turn into a regulatory headache for the fallen photography giant.

Kodak’s depressed stock price surged last week before the company announced its plans to work with President Donald Trump’s administration in exchange for a $765 million loan. That prompted Sen. Elizabeth Warren to send a Monday letter asking the Securities and Exchange Commission to investigate whether insider trading laws have been broken.

The SEC is now in the early stages of a probe, according to a report published Tuesday by The Wall Street Journal. The newspaper cited unidentified people familiar with the matter.

The SEC declined to comment on the report.

Kodak said Tuesday that the Rochester, New York, company intends to cooperate with any potential inquiries, without saying whether it has been contacted by the SEC.