(Reuters) – U.S. prosecutors have sued the founder and former CEO of Auspex Pharmaceuticals Inc., accusing him of giving illegal tips to friends and family because Teva Pharmaceutical Industries Ltd. was preparing to buy its company on a $ 3.5 billion transaction.
On Tuesday, Sepehr Sarshar was accused of abusing material non-public information from San Diego-based Auspex in early 2015 related to Teva's expected bid and giving tips to his girlfriend, two other friends and a close relative.  The office of Acting U.S. Attorney Audrey Strauss in Manhattan said the resulting trade in Nasdaq-listed Auspex generated more than $ 700,000 in illegal profits.
It also said that Sarshar misled the Financial Industry Regulatory Authority, the industry's own watchdog, in its probe into suspected trafficking in Auspex by hiding its ties to the recipients of the tips.
Mr. Sarshar, 53, of Encinitas, California, was charged with securities fraud, wire fraud and fraud in connection with a bid.
The charges carry a maximum prison sentence of 25, 20 and 20 years respectively. U.S. The Securities and Exchange Commission brought a related civil lawsuit against Sarshar.
Sarshar's lawyers did not immediately respond to a request for comment. Teva was not charged or charged with violations.
"We keep repeating where those who are interested in a company's insider information send it to family and friends," FBI Assistant Director William Sweeney said in a statement. "Balancing the market balance in this way puts all investors at a disadvantage."
On March 30, 201
The main product of Auspex was to treat chorea, a disorder characterized by abnormal involuntary movement and sometimes associated with Huntington's disease.
Criminal case is U.S. v. Sarshar U.S. District Court, South District of New York. Catalog