(MENAFN- Live Mint) (Bloomberg) -- A Pharmaceutical scientist was accused of making $617,000 in illegal profits from trading on a secret tip he got from his domestic partner about plans by drug store chain CVS health Corp. to buy Oak Street Health Inc., where she was a senior executive.
Carlos Sacanell, 58, was charged with insider trading and lying to federal investigators in an indictment unsealed in Philadelphia federal court. His domestic partner, who wasn't identified, was described as serving on the executive committee of Oak Street, a Chicago-based primary care provider.
Sacanell pleaded not guilty at a court hearing on Thursday, according to a spokeswoman for Philadelphia US Attorney Jacqueline Romero. He was released on bond. The identity of his attorney couldn't be determined.
Sacanell was a senior scientist for a manufacturer of non-prescription healthcare products, according to the US Securities and Exchange Commission, which also sued Sacanell in Philadelphia on Thursday. He shared a home with the Oak Street executive in Swarthmore, Pennsylvania, from 2010 until early this year.
Prosecutors said Sacanell learned about the planned acquisition from his domestic partner, who told him the information was“confidential and could not be shared.”
CVS agreed in February 2023 to buy Oak Street in a $10.6 billion deal, which was part of the Woonsocket, Rhode Island-based drug store chain's move into direct patient care.
On a single day before the deal was announced on Feb. 8, 2023, Sacanell, who hadn't traded in Oak Street in the previous two years, was allegedly the market's biggest trader of the company's options. At the end of Feb. 3, Sacanell held 26,680 shares of Oak Street and 1,313 call options, with a Feb. 17 expiration date.
Later, when questioned by the Federal Bureau of Investigation, Sacanell lied, claiming he hadn't gotten advance information about CVS's plan to buy Oak Street, according to prosecutors.
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