A high-profile biotech CEO has been sentenced to prison after deliberately misleading investors to line his own pockets.
Nader Pourhassan, 62, from Lake Oswego, Oregon, received a 30-month prison term on Friday for orchestrating a scheme that falsely promoted his company’s drug development while profiting from the inflated stock price.
Exploiting a Health Crisis for Personal Gain
Authorities say Pourhassan took advantage of public fear during the HIV and COVID-19 crises to misrepresent his company’s progress.
Assistant Attorney General A. Tysen Duva explained that this type of deception exploits vulnerable Americans and shakes trust in financial markets.
“The Criminal Division is committed to holding corporate executives accountable when they manipulate investors,” Duva stated.
U.S. Attorney Kelly O. Hayes added, “Pourhassan intentionally deceived investors and the public out of millions, enriching himself in the process.
This sentence sends a clear message: executives who prioritize greed over honesty will face consequences.”
FBI and FDA Weigh In on Corporate Fraud
Special Agent in Charge Jimmy Paul of the FBI Baltimore Field Office emphasized the broader impact of Pourhassan’s actions.
“He betrayed the trust of investors and undermined confidence in our financial institutions. The FBI is determined to pursue those who manipulate the market for personal gain.”
Similarly, FDA-OCI Special Agent Robert Iwanicki reminded the public that fraud tied to medical products will not be tolerated.
“The FDA will continue working with law enforcement to protect public health from those who place profits above safety,” he said.
How the Scheme Worked
Court records show that Pourhassan served as CEO of CytoDyn, a publicly traded company based in Vancouver, Washington.
Between 2018 and 2021, he misled investors about the likelihood of FDA approval for an investigational drug aimed at treating HIV and COVID-19.
By inflating the stock price with false claims, he attracted new investors and sold off 4.8 million shares for $4.4 million.
In December 2024, a jury convicted Pourhassan on multiple counts, including securities fraud, wire fraud, and insider trading.
At sentencing, he was ordered to pay more than $5.3 million in restitution and to forfeit over $4.4 million.
Collaboration Behind the Investigation
The investigation involved multiple agencies, including the FBI, FDA-OCI, and the U.S. Postal Inspection Service.
Prosecutors from the Criminal Division’s Fraud Section and the District of Maryland worked closely with law clerks and paralegal specialists to secure the conviction.
What This Means for Investors
This case serves as a stark reminder that executives cannot mislead the public for personal gain without facing serious consequences.
Authorities continue to warn that financial fraud—especially tied to public health—will be met with rigorous investigation and prosecution.
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