Former Pharmaceutical Executive And Doctor Sentenced For Insider Trading Around Alexion Pharmaceuticals’ Acquisition Of Portola Pharmaceuticals

 

Joseph Dupont, Former Vice President of Alexion, Misappropriated Deal Information and Tipped Another Individual; Slava Kaplan Used Misappropriated Information to Trade and to Tip Others

Damian Williams, the United States Attorney for the Southern District of New York, announced that JOSEPH DUPONT and SLAVA KAPLAN, a/k/a “Stanley Kaplan,” were sentenced to three years’ probation and five months in prison, respectively, for securities fraud in connection with their participation in an insider trading scheme surrounding the announcement of Alexion Pharmaceutical, Inc.’s acquisition of Portola Pharmaceuticals, Inc.  DUPONT and KAPLAN were arrested June 2023 and pled guilty before U.S. District Judge Gregory H. Woods in September 2023. 

U.S. Attorney Damian Williams said: “This Office continues to keep a watchful eye over Wall Street, and we will work quickly to prosecute those who choose to cheat to make a quick buck.  These sentences reflect our commitment to ensuring fairness in the stock market and combatting corruption.” 

According to the allegations in the Indictment and statements made in public court proceedings:

In 2020, DUPONT, KAPLAN, and others engaged in an insider trading scheme surrounding the announcement of Alexion’s acquisition of Portola.  DUPONT was a vice president at Alexion and, on January 31, 2020, was informed of Alexion’s upcoming acquisition of Portola.  Before that acquisition was publicly announced, in April 2020, DUPONT provided material, non-public information (“MNPI”) that he misappropriated from Alexion about the acquisition to a friend so that the friend could use the information to trade profitably in securities.

In turn, DUPONT’s friend provided KAPLAN, who was also known to DUPONT, the MNPI about Portola’s pending acquisition, both so that KAPLAN could trade in advance of the acquisition and so that KAPLAN would assist DUPONT’s friend in formulating trading strategies to maximize DUPONT’s friend’s own trading profits.  KAPLAN further shared MNPI about the upcoming acquisition with a family member and a friend and colleague.  After Alexion’s acquisition of Portola was publicly announced on the morning of May 5, 2020, causing Portola’s stock price to increase significantly, KAPLAN and others who had purchased shares and options based on DUPONT’s inside information sold their shares of Portola and call options for Portola stock, reaping millions of dollars of illegally obtained trading profits.

Additionally, JOSEPH DUPONT, 45, of Rehoboth, Massachusetts, was fined $75,000.  SLAVA KAPLAN, 45, of Hopewell Junction, New York, was sentenced to three years of supervised release and was ordered to forfeit $472,053.61.  

Mr. Williams praised the outstanding work of the Federal Bureau of Investigation.  Mr. Williams also thanked the U.S. Securities and Exchange Commission, which has filed a parallel civil action.