Nader Pourhassan, 62, of Lake Oswego, Oregon, was sentenced on penultimate Friday to 30 months in prison for misleading investors about his company’s development of a new drug, then selling his personal stock in the company at artificially inflated prices.
“The defendant lied to investors about a drug to treat HIV and COVID-19 so he could engage in insider trading,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “This type of fraud exploits vulnerable Americans, undermines the integrity of our financial markets, and erodes the trust that investors place in public companies. The Criminal Division remains committed to prosecuting corporate executives who deceive investors.”
“Pourhassan exploited a deadly public health crisis to intentionally deceive investors and the public out of millions, all so that he could enrich himself,” said U.S. Attorney Kelly O. Hayes for the District of Maryland. “As this sentence makes clear, executives who mislead investors and manipulate the truth for personal gain will be held accountable. Our office will continue to aggressively pursue those who put greed ahead of honesty and the rule of law.”
“Nader Pourhassan lied and schemed to selfishly line his own pockets. He betrayed the trust placed in him as a corporate executive by deceiving and misleading investors,” said Special Agent in Charge Jimmy Paul of the FBI Baltimore Field Office. “Not only are his actions illegal, but they also serve to undermine public confidence in our financial institutions. This sentencing shows the FBI’s commitment to rooting out fraudsters seeking to manipulate the market.”
“Today’s announcement should serve as a reminder that fraud related to medical products will not be tolerated,” said Special Agent in Charge Robert Iwanicki of the Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI) Los Angeles Field Office. “The FDA will continue to work with our law enforcement partners to bring to justice those who place profits above public health.”
According to court documents and evidence presented at trial, Pourhassan was the Chief Executive Officer of CytoDyn, a publicly traded company based in Vancouver, Washington, that was developing an investigational drug to treat HIV and COVID-19.
Between 2018 and 2021, Pourhassan intentionally misled investors about the drug’s prospects for FDA approval to artificially inflate the price of CytoDyn’s stock and attract new investors.
He then sold his 4.8 million shares of CytoDyn stock after making false announcements to investors, pocketing $4.4 million.
In December 2024, Pourhassan was convicted at trial of four counts of securities fraud, two counts of wire fraud and three counts of insider trading.
At sentencing, he was ordered to pay more than $5.3 million in restitution and to forfeit more than $4.4 million.
