SEC v. Amit Dagar; and Atul Bhiwapurkar, No. 1:23-cv-5564, Southern District of New York (July 24, 2023) — Complaint

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

SECURITIES AND EXCHANGE
COMMISSION,

Plaintiff,

-against-

AMIT DAGAR and ATUL BHIWAPURKAR

Defendant.

COMPLAINT

1:23-cv-5564

JURY TRIAL DEMANDED

 COMPLAINT

Plaintiff Securities and Exchange Commission (“Commission”), for its Complaint against
Amit Dagar (“Dagar”) and Atul Bhiwapurkar (“Bhiwapurkar”), (collectively, “Defendants”)
alleges as follows:
SUMMARY

1. This action involves insider trading by Defendants in the securities of Pfizer Inc.
(“Pfizer”) based on material nonpublic information obtained by Dagar, then a Pfizer employee,
ahead of Pfizer’s November 5, 2021, announcement that its COVID-19 antiviral treatment,
Paxlovid, significantly reduced hospitalization and death (the “Paxlovid Announcement”).
Pfizer’s CEO referred to the Paxlovid Announcement as a “game-changer” in the global efforts
to “halt the devastation” of the pandemic.
2. Dagar, a Senior Statistical Programming Lead at Pfizer, was a member of the
statistical team that compiled and organized data during Pfizer’s Paxlovid clinical trials. In his
role Dagar was “blinded,” meaning that the data to which Dagar had access did not disclose
whether the patients received Paxlovid or a placebo.

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3. On November 4, 2021, before Pfizer publicly announced the result of its Paxlovid
clinical trial, Dagar learned of the successful result and that Pfizer planned to issue a press
release on November 5, 2021.
4. Within hours of learning of the successful Paxlovid clinical trial and the planned
press release, Dagar, based on the material nonpublic information he learned about Paxlovid and
in breach of his fiduciary duty to Pfizer, purchased Pfizer call options
1
 and tipped his friend,
Bhiwapurkar, of the successful trial.
5. Bhiwapurkar then traded on the material nonpublic information he received from
Dagar and in turn tipped another friend, Individual A, about the successful Paxlovid clinical trial.
6. Following the Paxlovid Announcement, Pfizer’s stock price increased $4.76,
nearly 11% from its previous close. This was Pfizer’s largest single-day stock price move since
2009. Dagar, who purchased $8,380 in Pfizer call options, generated a one-day profit of
approximately $214,395 and Bhiwapurkar, who purchased $7,400 in Pfizer call options,
generated a one-day profit of approximately $60,300. Individual A, who Bhiwapurkar tipped,
generated a one-day profit of approximately $29,770.

1
 A buyer who purchases a call option for a specific stock has the opportunity, but not the
obligation, to buy that stock for a specific price for a predetermined period.

3

VIOLATIONS

7. By virtue of the foregoing conduct and as alleged further herein, Defendants
violated Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §
78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].
8. Unless Defendants are restrained and enjoined, they will engage in the acts,
practices, transactions, and courses of business set forth in this Complaint or in acts practices,
transactions, and courses of business of similar type and object.
NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT

9. The Commission brings this action pursuant to authority conferred upon it by the
Exchange Act Sections 21(d) [15 U.S.C. § 78u(d)] and 21A(a) [15 U.S.C. § 78u-1(a)].
10. The Commission seeks a final judgment: (a) permanently restraining and
enjoining Defendants from violating the federal securities laws and rules this complaint alleges
they violated; (b) ordering Defendants to disgorge any ill-gotten gains they received as a result of
the violations alleged here and to pay prejudgment interest thereon pursuant to Exchange Act
Section 21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), (d)(5) and 78u(d)(7)]; (c)
ordering Defendants to pay civil money penalties pursuant to Exchange Act Section 21A [15
U.S.C. § 78u-1]; and (d) ordering any other further relief that the Court may deem just and
proper.
JURISDICTION AND VENUE

11. This Court has jurisdiction over this action pursuant to Exchange Act Section 27
[15 U.S.C. § 78aa].

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12. Defendants, directly and indirectly, made use of the means or instrumentalities of
interstate commerce or of the mails in connection with the transactions, acts, practices, and
courses of business alleged herein.
13. Venue lies in this District under Exchange Act Section 27(a) [15 U.S.C. §
78aa(a)]. Certain of the acts, practices, transactions, and courses of business alleged in this
Complaint occurred within this District, including that at all relevant times, Pfizer shares traded
on the New York Stock Exchange, which is located in New York, New York and Pfizer
maintained its corporate headquarters in New York, New York.
DEFENDANTS

14. Dagar, age 43, resides in Hillsborough, New Jersey. From at least 2017 until
approximately January 2023, Dagar was employed directly by Pfizer. From at least 2009 to
2017, Dagar worked for another company who assigned Dagar to work as a vendor for Pfizer.
15. Bhiwapurkar, age 44, resides in Milpitas, California. Bhiwapurkar is an engineer
for a publicly traded computer drive manufacturer and data storage company located in San Jose,
California. Bhiwapurkar and Dagar are close friends who both attended the University of Texas
at Arlington where they studied electrical engineering.
OTHER RELEVANT ENTITIES AND INDIVIDUALS

16. Pfizer is a biopharmaceutical company, incorporated in Delaware and
headquartered in New York, New York. Pfizer’s common stock is listed on the New York Stock
Exchange, traded under the symbol “PFE.”
17. Individual A resides in San Ramon, California and works for a publicly traded
internet search and technology company. Individual A attended college with Bhiwapurkar.

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18. EQIQ Holdings, LLC (“EQIQ”) was an investment vehicle that invested in
private equity securities registered in Wilmington, Delaware. Dagar, Bhiwapurkar, Individual A,
and at least one other individual were partners in EQIQ.
FACTS
I. Dagar’s Role in Pfizer’s Paxlovid Clinical Trials

19. Dagar worked in a s tatistical programming and analysis group at Pfizer, which
was responsible for compiling and organizing the data for all clinical trials related to Paxlovid.
The group in which Dagar worked was responsible for organizing but not analyzing the Paxlovid
data.
20.  Dagar was assigned to the clinical trial that examined Paxlovid’s effect on high-
risk patients (the “Paxlovid Clinical Trial”).
21. The Paxlovid Clinical Trial was intended to be designed so that it was not
possible for Dagar or other members of the group in which he worked to determine the safety or
efficacy of Paxlovid from the data the group organized. For this reason, Dagar’s group was
considered “blinded.”
22. At all relevant times, as an employee of Pfizer, Dagar was required to comply
with Pfizer’s Code of Conduct and corporate policies, including policies related to insider trading
and the safeguarding of material nonpublic information.
23. Under Pfizer’s policies,  Dagar owed a duty to Pfizer not to trade on confidential
information or advise others to do so; was required to maintain the confidentiality of Pfizer’s
material nonpublic information; and was prohibited from disclosing to persons outside of Pfizer
material nonpublic information without prior approval.
24.  Pfizer’s Code of Conduct included an insider trading policy, which stated:

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Securities laws and Pfizer policy prohibit us from disclosing or using any
material non-public or “inside” information that we acquire during our
employment at Pfizer. We do not use material, non-public information to
buy or sell the securities of Pfizer . . . before this information is known
publicly. We also do not give inside information to anyone else so that
they can do so.

25. Pfizer’s Code of Conduct also explained that “[m]aterial information is any
information that a reasonable investor would consider important” and that “information is non-
public until it has been adequately disseminated to the public and the public has had time to
absorb the information.”
26. Pfizer also had a Corporate Policy for the treatment of material nonpublic
information which was consistent with the Code of Conduct and further explained that
“information should not be considered public until the first business day after it is disseminated.”
This policy defined material nonpublic information to include significant clinical drug trial
results.
27. Pfizer further had a Corporate Policy which prohibited employees from
purchasing or selling options on Pfizer stock.
28. Dagar was aware of Pfizer’s Code of Conduct and his obligations having
completed a training on Pfizer’s Code of Conduct on or about February 23, 2021.
II. Dagar Learned of the Results of the Paxlovid Clinical Trial and Announcement on
November 4, 2021, Prior to Pfizer’s Announcement

29. Pfizer began the Paxlovid Clinical Trial in or about July 16, 2021, as part of the
company’s “lightspeed” efforts to address the global health pandemic. On November 1, 2021, a
Pfizer data monitoring committee received unblinded interim results for the Paxlovid Clinical
Trial. The data monitoring committee was charged with reviewing unblinded data from the
Paxlovid Clinical Trial and making recommendations.

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30. On or about November 2, 2021, a trading blackout notice was distributed to those
with access to the unblinded data for the Paxlovid Clinical Trial.
31.  On November 3, 2021, after reviewing the unblinded Paxlovid Clinical Trial
interim data, the Pfizer data monitoring committee recommended that Pfizer submit a new drug
application to the United States Food and Drug Administration (“FDA”) for Paxlovid. On the
same day, Pfizer sent an email notification and draft press release to the FDA.
32. In the early morning of November 4, 2021, at approximately 5:54 AM EST,
Dagar’s supervisor received an email informing him that Pfizer would file a new drug
application for Paxlovid. The email also disclosed that Pfizer would issue a press release
regarding Paxlovid on November 5, 2021.
33.  Dagar’s supervisor, who like Dagar was blinded from the results of the Paxlovid
Clinical Trial, should not have been told of the positive results until he and his group were
unblinded.
34. On November 4, 2021, beginning at approximately 8:50 AM EST, Dagar and his
supervisor exchanged chat messages in which Dagar’s supervisor conveyed the positive results
of the Paxlovid Clinical Trial. Dagar’s supervisor told Dagar that “we received the outcome” of
the Paxlovid Clinical Trial and that Pfizer would issue a “press release tomorrow.”  Dagar’s
supervisor also informed Dagar that there would be a “lot of work lined up” due to the results.
35. On November 4, 2021, at approximately 8:57 AM EST, a member of the
unblinded side of the Paxlovid Clinical Trial team sent Dagar an email that stated that Pfizer was
preparing Paxlovid Clinical Trial data for submission to regulatory authorities.

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36. The fact that Pfizer was preparing the Paxlovid Clinical Trial data for submission
should not have been disclosed to Dagar who was a blinded member of the Paxlovid Clinical
Trial team because it indicated a positive result.
III. Dagar Purchased Pfizer Options Based on Material Nonpublic Information about
the Paxlovid Clinical Trial

37. Approximately four and a half hours after first learning of the successful Paxlovid
Clinical Trial, at approximately 1:21 PM EST on November 4, 2021, Dagar purchased $8,380
worth of short term, out-of-the-money call options in Pfizer stock.
38. An out-of-the-money call option is an option that grants the purchaser the
opportunity to purchase a stock at a price greater than the price at which the stock is currently
selling on the market. The Pfizer call options Dagar purchased on November 4, 2021, granted
him the option to purchase Pfizer stock at prices ranging from $44 to $46 at a time when Pfizer
stock was trading at less than $43.86. The call options Dagar purchased were also set to expire
between the next day, November 5, 2021, and November 19, 2021, which was a two-week
period prior to which Pfizer did not publicly state its intent to make a significant announcement.
39. Prior to purchasing Pfizer options on November 4, 2021, Dagar had never before
used his brokerage account to trade in Pfizer options and had not traded Pfizer stock since 2018.
40. On November 5, 2021, at approximately 6:45 AM EST, before the New York
Stock Exchange opened for trading, Pfizer issued its Paxlovid Announcement. According to the
Announcement, after an interim analysis of a randomized double-blind study, Paxlovid was
found to reduce hospitalization or death by 89% compared to placebo in non-hospitalized high-
risk adults.

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41. The Paxlovid Announcement further stated that because of the positive results of
the Paxlovid Clinical Trial, Pfizer would end further enrollment in the Paxlovid Clinical Trial
and seek emergency use authorization from the FDA.
42. Following the Paxlovid Announcement, Pfizer’s stock price increased $4.76,
nearly 11% higher than its previous closing price of $43.85. This was Pfizer’s largest single-day
stock price move since 2009. As a result, Dagar’s $8,380 purchase of Pfizer call options
generated a one-day profit of approximately $214,395, representing an investment return of
approximately 2,458%.
43. Dagar purchased the Pfizer call options, as alleged above, while in possession of
and based on material nonpublic information regarding Pfizer’s Paxlovid Clinical Trial. The
result of the Paxlovid Clinical Trial was material because there was a substantial likelihood a
reasonable investor would consider the information important in deciding whether to purchase or
sell Pfizer securities.
44. The result of the Paxlovid Clinical Trial was nonpublic because, prior to the
Paxlovid Announcement, it was not broadly disseminated generally in the investing public.
45. Dagar knew, consciously avoided knowing, or was reckless in not knowing that
the information he possessed about Paxlovid was material and nonpublic.
46. Dagar knew, consciously avoided knowing, or was reckless in not knowing that,
by trading on Pfizer’s confidential information, as alleged above, he was breaching Pfizer’s
policies and his fiduciary duty or similar obligation arising from a relationship of trust and
confidence to Pfizer.

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IV. Dagar Tipped Bhiwapurkar with Material Nonpublic Information about the
Paxlovid Clinical Trial and Bhiwapurkar Traded on that Tip

47. At all relevant times in October and November 2021, Dagar and Bhiwapurkar
were longtime friends. Dagar and Bhiwapurkar communicated often via WhatsApp messages
and telephone calls about topics including investing in securities and business opportunities.
48. Dagar, Bhiwapurkar, and Individual A were also partners, with at least one other
individual, in EQIQ,  a company with at least $1 million in equity, of which at least $600,000 was
principal contributed by Bhiwapurkar. EQIQ purchased privately owned shares of stock before
companies’ initial public offerings.
49. In addition to purchasing Pfizer securities in his own account, Dagar also tipped
his friend Bhiwapurkar with material nonpublic information about the positive Paxlovid Clinical
Trial results.
50. At approximately 3:41 PM EST on November 4, 2021, Bhiwapurkar, using a
brokerage account held in his and his wife’s names, purchased out-of-the-money call options in
Pfizer stock for approximately $7,400. The call options Bhiwapurkar purchased granted him the
option to purchase Pfizer stock at $45 at a time when Pfizer was trading between $43.49 and
$43.66 and were set to expire on November 19, 2021. As a result of the Pfizer stock price
increase after Pfizer released the Paxlovid Announcement, Bhiwapurkar realized a one-day profit
of approximately $60,300, representing an investment return of approximately 791%.
51. Prior to purchasing Pfizer call options on November 4, 2021, Bhiwapurkar had
never before used his brokerage account to trade in Pfizer options or stock. On November 4,
2021, after he purchased Pfizer call options, beginning at approximately 3:47 PM EST,
Bhiwapurkar sent Dagar three messages using the WhatsApp instant messaging service.
Bhiwapurkar later deleted those messages.

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52. Dagar tipped Bhiwapurkar for personal benefit, including the benefit of making a
gift of material nonpublic information to his close friend.
53. Dagar intended for Bhiwapurkar to trade on the tip, and he knew, consciously
avoided knowing, or was reckless in not knowing that the information he communicated to
Bhiwapurkar would be used to trade in Pfizer securities.
54. On November 4, 2021, Bhiwapurkar knew that Dagar worked at Pfizer and had
access to confidential information about Pfizer’s clinical research regarding COVID-19
treatments.
55. Bhiwapurkar purchased Pfizer call options as alleged above while in possession
of and based on the material nonpublic information that he received from Dagar. Bhiwapurkar
knew, consciously avoided knowing, or was reckless in not knowing, that the information was
material and nonpublic.
56. Bhiwapurkar knew, consciously avoided knowing, or was reckless in not knowing
that the tip he received from Dagar was conveyed in breach of Dagar’s fiduciary duty to Pfizer or
similar obligation arising from a relationship of trust and confidence for personal benefit.
V. Bhiwapurkar C ommunicated Material Nonpublic Information about the Paxlovid
Trial to Individual A Who Traded on the Tip

57. At all relevant times in October and November 2021, Bhiwapurkar and Individual
A were longtime friends who originally met in college. Bhiwapurkar and Individual A
communicated often via WhatsApp, telephone calls, text messages, and in person, and discussed
topics including investing in securities and business opportunities.
58. Bhiwapurkar and Individual A were also partners with Dagar in EQIQ, with
Individual A serving as the managing member.

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59. In addition to trading Pfizer securities in his own account, Bhiwapurkar tipped his
friend Individual A to purchase Pfizer securities based on the material nonpublic information that
Bhiwapurkar had received from Dagar about the Paxlovid Clinical Trial.
60. On November 4, 2021, beginning at approximately 3:54 PM EST and
approximately 13 minutes after Bhiwapurkar purchased Pfizer call options for his own account,
Bhiwapurkar and Individual A spoke for approximately forty minutes via WhatsApp.
61. At approximately 3:58 PM EST, while on the WhatsApp call with Bhiwapurkar
and just minutes before the New York Stock Exchange closed, Individual A purchased out-of-
the-money call options in Pfizer stock for approximately $2,850. As a result of the Pfizer stock
price increase after Pfizer released the Paxlovid Announcement, Individual A realized a one-day
profit of approximately $29,770, representing an investment return of approximately 945%.
62. Bhiwapurkar tipped Individual A for personal benefits, including the benefit of
making a gift of material nonpublic information to a friend.
63. Bhiwapurkar intended for Individual A to trade on the tip, and he knew,
consciously avoided knowing, or was reckless in not knowing that that Individual A would use
the tip to trade in Pfizer securities
FIRST CLAIM FOR RELIEF

Violations of Exchange Act Section 10(b) and Rule 10b-5 Thereunder
(All Defendants)

64. The Commission re-alleges and incorporates by reference here the allegations in
paragraphs 1 through 63.
65. Defendants, directly or indirectly, singly or in concert, in connection with the
purchase or sale of securities and by the use of means or instrumentalities of interstate
commerce, or the mails, or the facilities of a national securities exchange, knowingly or

13

recklessly have (i) employed one or more devices, schemes, or artifices to defraud, (ii) made one
or more untrue statements of a material fact or omitted to state one or more material facts
necessary in order to make the statements made, in light of the circumstances under which they
were made, not misleading, and/or (iii) engaged in one or more acts, practices, or courses of
business which operated or would operate as a fraud or deceit upon other persons.
66. By reason of the foregoing, Defendants, directly or indirectly, singly or in concert,
 have violated and, unless enjoined, will again violate Exchange Act Section 10(b) [15 U.S.C. §
78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].
PRAYER FOR RELIEF

WHEREFORE, the Commission respectfully requests that this Court enter a Final
Judgment:
I.

Permanently restraining and enjoining Defendants and their agents, servants, employees
and attorneys and all persons in active concert or participation with Defendants from violating,
directly or indirectly, Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5];
II.

Ordering Defendants to disgorge all ill-gotten gains received directly or indirectly, with
pre-judgment interest thereon, as a result of the alleged violations pursuant to Exchange Act
Sections 21(d)(3), (5), (7) [15 U.S.C. §§ 78u(d)(3), (5), (7)];
III.

Ordering Defendants to pay civil monetary penalties under Exchange Act Section 21A
[15 U.S.C. § 78u-1];

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IV.

Granting any other and further relief this Court may deem just and proper.
Dated:    June 29, 2023

/s/ Christopher J. Carney
Christopher J. Carney
Charlie Divine
Colby A. Steele*
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Phone:  202-551-2379 (Carney)
Phone:  202-551-6673 (Divine)
Phone:  202-551-3755 (Steele)
Email:  [email protected] (Carney)
Email:  [email protected] (Divine)
Email:  [email protected] (Steele)

*Pending admission pro hac vice

Of Counsel:
Paul E. Kim
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF NEW YORK 
 
 
SECURITIES AND EXCHANGE 
COMMISSION, 
 

Plaintiff, 
 

-against- 
 

AMIT DAGAR and ATUL BHIWAPURKAR 
 

Defendant. 
 

 
 

COMPLAINT 
 
1:23-cv-5564 
 
JURY TRIAL DEMANDED 

 
 COMPLAINT 

 
Plaintiff Securities and Exchange Commission (“Commission”), for its Complaint against 

Amit Dagar (“Dagar”) and Atul Bhiwapurkar (“Bhiwapurkar”), (collectively, “Defendants”) 

alleges as follows: 

SUMMARY 
 

1. This action involves insider trading by Defendants in the securities of Pfizer Inc. 

(“Pfizer”) based on material nonpublic information obtained by Dagar, then a Pfizer employee, 

ahead of Pfizer’s November 5, 2021, announcement that its COVID-19 antiviral treatment, 

Paxlovid, significantly reduced hospitalization and death (the “Paxlovid Announcement”).  

Pfizer’s CEO referred to the Paxlovid Announcement as a “game-changer” in the global efforts 

to “halt the devastation” of the pandemic. 

2. Dagar, a Senior Statistical Programming Lead at Pfizer, was a member of the 

statistical team that compiled and organized data during Pfizer’s Paxlovid clinical trials. In his 

role Dagar was “blinded,” meaning that the data to which Dagar had access did not disclose 

whether the patients received Paxlovid or a placebo.  

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3. On November 4, 2021, before Pfizer publicly announced the result of its Paxlovid 

clinical trial, Dagar learned of the successful result and that Pfizer planned to issue a press 

release on November 5, 2021.  

4. Within hours of learning of the successful Paxlovid clinical trial and the planned 

press release, Dagar, based on the material nonpublic information he learned about Paxlovid and 

in breach of his fiduciary duty to Pfizer, purchased Pfizer call options1 and tipped his friend, 

Bhiwapurkar, of the successful trial.  

5. Bhiwapurkar then traded on the material nonpublic information he received from 

Dagar and in turn tipped another friend, Individual A, about the successful Paxlovid clinical trial.  

6. Following the Paxlovid Announcement, Pfizer’s stock price increased $4.76, 

nearly 11% from its previous close. This was Pfizer’s largest single-day stock price move since 

2009. Dagar, who purchased $8,380 in Pfizer call options, generated a one-day profit of 

approximately $214,395 and Bhiwapurkar, who purchased $7,400 in Pfizer call options, 

generated a one-day profit of approximately $60,300. Individual A, who Bhiwapurkar tipped, 

generated a one-day profit of approximately $29,770.  

 
1 A buyer who purchases a call option for a specific stock has the opportunity, but not the 
obligation, to buy that stock for a specific price for a predetermined period.  

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VIOLATIONS 
 

7. By virtue of the foregoing conduct and as alleged further herein, Defendants 

violated Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 

78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]. 

8. Unless Defendants are restrained and enjoined, they will engage in the acts, 

practices, transactions, and courses of business set forth in this Complaint or in acts practices, 

transactions, and courses of business of similar type and object.  

NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT 
 

9. The Commission brings this action pursuant to authority conferred upon it by the 

Exchange Act Sections 21(d) [15 U.S.C. § 78u(d)] and 21A(a) [15 U.S.C. § 78u-1(a)].  

10. The Commission seeks a final judgment: (a) permanently restraining and 

enjoining Defendants from violating the federal securities laws and rules this complaint alleges 

they violated; (b) ordering Defendants to disgorge any ill-gotten gains they received as a result of 

the violations alleged here and to pay prejudgment interest thereon pursuant to Exchange Act 

Section 21(d)(3), 21(d)(5) and 21(d)(7) [15 U.S.C. §§ 78u(d)(3), (d)(5) and 78u(d)(7)]; (c) 

ordering Defendants to pay civil money penalties pursuant to Exchange Act Section 21A [15 

U.S.C. § 78u-1]; and (d) ordering any other further relief that the Court may deem just and 

proper.  

JURISDICTION AND VENUE 
 

11. This Court has jurisdiction over this action pursuant to Exchange Act Section 27 

[15 U.S.C. § 78aa]. 

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12. Defendants, directly and indirectly, made use of the means or instrumentalities of 

interstate commerce or of the mails in connection with the transactions, acts, practices, and 

courses of business alleged herein. 

13. Venue lies in this District under Exchange Act Section 27(a) [15 U.S.C. § 

78aa(a)]. Certain of the acts, practices, transactions, and courses of business alleged in this 

Complaint occurred within this District, including that at all relevant times, Pfizer shares traded 

on the New York Stock Exchange, which is located in New York, New York and Pfizer 

maintained its corporate headquarters in New York, New York. 

DEFENDANTS 
 

14. Dagar, age 43, resides in Hillsborough, New Jersey. From at least 2017 until 

approximately January 2023, Dagar was employed directly by Pfizer. From at least 2009 to 

2017, Dagar worked for another company who assigned Dagar to work as a vendor for Pfizer.  

15. Bhiwapurkar, age 44, resides in Milpitas, California. Bhiwapurkar is an engineer 

for a publicly traded computer drive manufacturer and data storage company located in San Jose, 

California. Bhiwapurkar and Dagar are close friends who both attended the University of Texas 

at Arlington where they studied electrical engineering.  

OTHER RELEVANT ENTITIES AND INDIVIDUALS 
 

16. Pfizer is a biopharmaceutical company, incorporated in Delaware and 

headquartered in New York, New York. Pfizer’s common stock is listed on the New York Stock 

Exchange, traded under the symbol “PFE.” 

17. Individual A resides in San Ramon, California and works for a publicly traded 

internet search and technology company. Individual A attended college with Bhiwapurkar. 

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18. EQIQ Holdings, LLC (“EQIQ”) was an investment vehicle that invested in 

private equity securities registered in Wilmington, Delaware. Dagar, Bhiwapurkar, Individual A, 

and at least one other individual were partners in EQIQ.  

FACTS 

I. Dagar’s Role in Pfizer’s Paxlovid Clinical Trials 
 

19. Dagar worked in a statistical programming and analysis group at Pfizer, which 

was responsible for compiling and organizing the data for all clinical trials related to Paxlovid. 

The group in which Dagar worked was responsible for organizing but not analyzing the Paxlovid 

data.  

20.  Dagar was assigned to the clinical trial that examined Paxlovid’s effect on high-

risk patients (the “Paxlovid Clinical Trial”).   

21. The Paxlovid Clinical Trial was intended to be designed so that it was not 

possible for Dagar or other members of the group in which he worked to determine the safety or 

efficacy of Paxlovid from the data the group organized. For this reason, Dagar’s group was 

considered “blinded.” 

22. At all relevant times, as an employee of Pfizer, Dagar was required to comply 

with Pfizer’s Code of Conduct and corporate policies, including policies related to insider trading 

and the safeguarding of material nonpublic information.  

23. Under Pfizer’s policies, Dagar owed a duty to Pfizer not to trade on confidential 

information or advise others to do so; was required to maintain the confidentiality of Pfizer’s 

material nonpublic information; and was prohibited from disclosing to persons outside of Pfizer 

material nonpublic information without prior approval.  

24.  Pfizer’s Code of Conduct included an insider trading policy, which stated:  

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Securities laws and Pfizer policy prohibit us from disclosing or using any 
material non-public or “inside” information that we acquire during our 
employment at Pfizer. We do not use material, non-public information to 
buy or sell the securities of Pfizer . . . before this information is known 
publicly. We also do not give inside information to anyone else so that 
they can do so. 
 

25. Pfizer’s Code of Conduct also explained that “[m]aterial information is any 

information that a reasonable investor would consider important” and that “information is non-

public until it has been adequately disseminated to the public and the public has had time to 

absorb the information.”  

26. Pfizer also had a Corporate Policy for the treatment of material nonpublic 

information which was consistent with the Code of Conduct and further explained that 

“information should not be considered public until the first business day after it is disseminated.” 

This policy defined material nonpublic information to include significant clinical drug trial 

results. 

27. Pfizer further had a Corporate Policy which prohibited employees from 

purchasing or selling options on Pfizer stock. 

28. Dagar was aware of Pfizer’s Code of Conduct and his obligations having 

completed a training on Pfizer’s Code of Conduct on or about February 23, 2021.   

II. Dagar Learned of the Results of the Paxlovid Clinical Trial and Announcement on 
November 4, 2021, Prior to Pfizer’s Announcement 

 
29. Pfizer began the Paxlovid Clinical Trial in or about July 16, 2021, as part of the 

company’s “lightspeed” efforts to address the global health pandemic. On November 1, 2021, a 

Pfizer data monitoring committee received unblinded interim results for the Paxlovid Clinical 

Trial. The data monitoring committee was charged with reviewing unblinded data from the 

Paxlovid Clinical Trial and making recommendations.  

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30. On or about November 2, 2021, a trading blackout notice was distributed to those 

with access to the unblinded data for the Paxlovid Clinical Trial.  

31.  On November 3, 2021, after reviewing the unblinded Paxlovid Clinical Trial 

interim data, the Pfizer data monitoring committee recommended that Pfizer submit a new drug 

application to the United States Food and Drug Administration (“FDA”) for Paxlovid. On the 

same day, Pfizer sent an email notification and draft press release to the FDA.  

32. In the early morning of November 4, 2021, at approximately 5:54 AM EST, 

Dagar’s supervisor received an email informing him that Pfizer would file a new drug 

application for Paxlovid. The email also disclosed that Pfizer would issue a press release 

regarding Paxlovid on November 5, 2021. 

33.  Dagar’s supervisor, who like Dagar was blinded from the results of the Paxlovid 

Clinical Trial, should not have been told of the positive results until he and his group were 

unblinded.  

34. On November 4, 2021, beginning at approximately 8:50 AM EST, Dagar and his 

supervisor exchanged chat messages in which Dagar’s supervisor conveyed the positive results 

of the Paxlovid Clinical Trial. Dagar’s supervisor told Dagar that “we received the outcome” of 

the Paxlovid Clinical Trial and that Pfizer would issue a “press release tomorrow.” Dagar’s 

supervisor also informed Dagar that there would be a “lot of work lined up” due to the results.   

35. On November 4, 2021, at approximately 8:57 AM EST, a member of the 

unblinded side of the Paxlovid Clinical Trial team sent Dagar an email that stated that Pfizer was 

preparing Paxlovid Clinical Trial data for submission to regulatory authorities.  

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36. The fact that Pfizer was preparing the Paxlovid Clinical Trial data for submission 

should not have been disclosed to Dagar who was a blinded member of the Paxlovid Clinical 

Trial team because it indicated a positive result.  

III. Dagar Purchased Pfizer Options Based on Material Nonpublic Information about 
the Paxlovid Clinical Trial 

 
37. Approximately four and a half hours after first learning of the successful Paxlovid 

Clinical Trial, at approximately 1:21 PM EST on November 4, 2021, Dagar purchased $8,380 

worth of short term, out-of-the-money call options in Pfizer stock.  

38. An out-of-the-money call option is an option that grants the purchaser the 

opportunity to purchase a stock at a price greater than the price at which the stock is currently 

selling on the market. The Pfizer call options Dagar purchased on November 4, 2021, granted 

him the option to purchase Pfizer stock at prices ranging from $44 to $46 at a time when Pfizer 

stock was trading at less than $43.86. The call options Dagar purchased were also set to expire 

between the next day, November 5, 2021, and November 19, 2021, which was a two-week 

period prior to which Pfizer did not publicly state its intent to make a significant announcement.  

39. Prior to purchasing Pfizer options on November 4, 2021, Dagar had never before 

used his brokerage account to trade in Pfizer options and had not traded Pfizer stock since 2018.  

40. On November 5, 2021, at approximately 6:45 AM EST, before the New York 

Stock Exchange opened for trading, Pfizer issued its Paxlovid Announcement. According to the 

Announcement, after an interim analysis of a randomized double-blind study, Paxlovid was 

found to reduce hospitalization or death by 89% compared to placebo in non-hospitalized high-

risk adults.  

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41. The Paxlovid Announcement further stated that because of the positive results of 

the Paxlovid Clinical Trial, Pfizer would end further enrollment in the Paxlovid Clinical Trial 

and seek emergency use authorization from the FDA.  

42. Following the Paxlovid Announcement, Pfizer’s stock price increased $4.76, 

nearly 11% higher than its previous closing price of $43.85. This was Pfizer’s largest single-day 

stock price move since 2009. As a result, Dagar’s $8,380 purchase of Pfizer call options 

generated a one-day profit of approximately $214,395, representing an investment return of 

approximately 2,458%.  

43. Dagar purchased the Pfizer call options, as alleged above, while in possession of 

and based on material nonpublic information regarding Pfizer’s Paxlovid Clinical Trial. The 

result of the Paxlovid Clinical Trial was material because there was a substantial likelihood a 

reasonable investor would consider the information important in deciding whether to purchase or 

sell Pfizer securities.   

44. The result of the Paxlovid Clinical Trial was nonpublic because, prior to the 

Paxlovid Announcement, it was not broadly disseminated generally in the investing public.  

45. Dagar knew, consciously avoided knowing, or was reckless in not knowing that 

the information he possessed about Paxlovid was material and nonpublic.  

46. Dagar knew, consciously avoided knowing, or was reckless in not knowing that, 

by trading on Pfizer’s confidential information, as alleged above, he was breaching Pfizer’s 

policies and his fiduciary duty or similar obligation arising from a relationship of trust and 

confidence to Pfizer. 

 

 

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IV. Dagar Tipped Bhiwapurkar with Material Nonpublic Information about the 
Paxlovid Clinical Trial and Bhiwapurkar Traded on that Tip 

 
47. At all relevant times in October and November 2021, Dagar and Bhiwapurkar 

were longtime friends. Dagar and Bhiwapurkar communicated often via WhatsApp messages 

and telephone calls about topics including investing in securities and business opportunities. 

48. Dagar, Bhiwapurkar, and Individual A were also partners, with at least one other 

individual, in EQIQ, a company with at least $1 million in equity, of which at least $600,000 was 

principal contributed by Bhiwapurkar. EQIQ purchased privately owned shares of stock before 

companies’ initial public offerings.  

49. In addition to purchasing Pfizer securities in his own account, Dagar also tipped 

his friend Bhiwapurkar with material nonpublic information about the positive Paxlovid Clinical 

Trial results.   

50. At approximately 3:41 PM EST on November 4, 2021, Bhiwapurkar, using a 

brokerage account held in his and his wife’s names, purchased out-of-the-money call options in 

Pfizer stock for approximately $7,400. The call options Bhiwapurkar purchased granted him the 

option to purchase Pfizer stock at $45 at a time when Pfizer was trading between $43.49 and 

$43.66 and were set to expire on November 19, 2021. As a result of the Pfizer stock price 

increase after Pfizer released the Paxlovid Announcement, Bhiwapurkar realized a one-day profit 

of approximately $60,300, representing an investment return of approximately 791%.   

51. Prior to purchasing Pfizer call options on November 4, 2021, Bhiwapurkar had 

never before used his brokerage account to trade in Pfizer options or stock. On November 4, 

2021, after he purchased Pfizer call options, beginning at approximately 3:47 PM EST, 

Bhiwapurkar sent Dagar three messages using the WhatsApp instant messaging service. 

Bhiwapurkar later deleted those messages.  

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52. Dagar tipped Bhiwapurkar for personal benefit, including the benefit of making a 

gift of material nonpublic information to his close friend. 

53. Dagar intended for Bhiwapurkar to trade on the tip, and he knew, consciously 

avoided knowing, or was reckless in not knowing that the information he communicated to 

Bhiwapurkar would be used to trade in Pfizer securities. 

54. On November 4, 2021, Bhiwapurkar knew that Dagar worked at Pfizer and had 

access to confidential information about Pfizer’s clinical research regarding COVID-19 

treatments.  

55. Bhiwapurkar purchased Pfizer call options as alleged above while in possession 

of and based on the material nonpublic information that he received from Dagar. Bhiwapurkar 

knew, consciously avoided knowing, or was reckless in not knowing, that the information was 

material and nonpublic.   

56. Bhiwapurkar knew, consciously avoided knowing, or was reckless in not knowing 

that the tip he received from Dagar was conveyed in breach of Dagar’s fiduciary duty to Pfizer or 

similar obligation arising from a relationship of trust and confidence for personal benefit. 

V. Bhiwapurkar Communicated Material Nonpublic Information about the Paxlovid 
Trial to Individual A Who Traded on the Tip 

 
57. At all relevant times in October and November 2021, Bhiwapurkar and Individual 

A were longtime friends who originally met in college. Bhiwapurkar and Individual A 

communicated often via WhatsApp, telephone calls, text messages, and in person, and discussed 

topics including investing in securities and business opportunities. 

58. Bhiwapurkar and Individual A were also partners with Dagar in EQIQ, with 

Individual A serving as the managing member.  

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59. In addition to trading Pfizer securities in his own account, Bhiwapurkar tipped his 

friend Individual A to purchase Pfizer securities based on the material nonpublic information that 

Bhiwapurkar had received from Dagar about the Paxlovid Clinical Trial.   

60. On November 4, 2021, beginning at approximately 3:54 PM EST and 

approximately 13 minutes after Bhiwapurkar purchased Pfizer call options for his own account, 

Bhiwapurkar and Individual A spoke for approximately forty minutes via WhatsApp.  

61. At approximately 3:58 PM EST, while on the WhatsApp call with Bhiwapurkar 

and just minutes before the New York Stock Exchange closed, Individual A purchased out-of-

the-money call options in Pfizer stock for approximately $2,850. As a result of the Pfizer stock 

price increase after Pfizer released the Paxlovid Announcement, Individual A realized a one-day 

profit of approximately $29,770, representing an investment return of approximately 945%. 

62. Bhiwapurkar tipped Individual A for personal benefits, including the benefit of 

making a gift of material nonpublic information to a friend. 

63. Bhiwapurkar intended for Individual A to trade on the tip, and he knew, 

consciously avoided knowing, or was reckless in not knowing that that Individual A would use 

the tip to trade in Pfizer securities 

FIRST CLAIM FOR RELIEF 
 

Violations of Exchange Act Section 10(b) and Rule 10b-5 Thereunder 
(All Defendants) 

 
64. The Commission re-alleges and incorporates by reference here the allegations in 

paragraphs 1 through 63. 

65. Defendants, directly or indirectly, singly or in concert, in connection with the 

purchase or sale of securities and by the use of means or instrumentalities of interstate 

commerce, or the mails, or the facilities of a national securities exchange, knowingly or 

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recklessly have (i) employed one or more devices, schemes, or artifices to defraud, (ii) made one 

or more untrue statements of a material fact or omitted to state one or more material facts 

necessary in order to make the statements made, in light of the circumstances under which they 

were made, not misleading, and/or (iii) engaged in one or more acts, practices, or courses of 

business which operated or would operate as a fraud or deceit upon other persons. 

66. By reason of the foregoing, Defendants, directly or indirectly, singly or in concert, 

 have violated and, unless enjoined, will again violate Exchange Act Section 10(b) [15 U.S.C. § 

78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]. 

PRAYER FOR RELIEF 
 

WHEREFORE, the Commission respectfully requests that this Court enter a Final 

Judgment: 

I. 
 

Permanently restraining and enjoining Defendants and their agents, servants, employees 

and attorneys and all persons in active concert or participation with Defendants from violating, 

directly or indirectly, Exchange Act Section 10(b) [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]; 

II. 
 

Ordering Defendants to disgorge all ill-gotten gains received directly or indirectly, with 

pre-judgment interest thereon, as a result of the alleged violations pursuant to Exchange Act 

Sections 21(d)(3), (5), (7) [15 U.S.C. §§ 78u(d)(3), (5), (7)]; 

III. 
 

Ordering Defendants to pay civil monetary penalties under Exchange Act Section 21A 

[15 U.S.C. § 78u-1]; 

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IV. 
 

Granting any other and further relief this Court may deem just and proper. 

Dated:    June 29, 2023 
 

/s/ Christopher J. Carney 
Christopher J. Carney 
Charlie Divine  
Colby A. Steele* 
Securities and Exchange Commission 
100 F Street, NE 
Washington, DC 20549 
Phone:  202-551-2379 (Carney) 
Phone:  202-551-6673 (Divine) 
Phone:  202-551-3755 (Steele) 
Email:  [email protected] (Carney) 
Email:  [email protected] (Divine) 
Email:  [email protected] (Steele) 

 
*Pending admission pro hac vice 
 
Of Counsel: 
Paul E. Kim 
Securities and Exchange Commission 
100 F Street, NE 
Washington, DC 20549 
 

 
 
 

 

Case 1:23-cv-05564   Document 1   Filed 06/29/23   Page 14 of 14


	I. Dagar’s Role in Pfizer’s Paxlovid Clinical Trials
	II. Dagar Learned of the Results of the Paxlovid Clinical Trial and Announcement on November 4, 2021, Prior to Pfizer’s Announcement
	III. Dagar Purchased Pfizer Options Based on Material Nonpublic Information about the Paxlovid Clinical Trial
	IV. Dagar Tipped Bhiwapurkar with Material Nonpublic Information about the Paxlovid Clinical Trial and Bhiwapurkar Traded on that Tip
	V. Bhiwapurkar Communicated Material Nonpublic Information about the Paxlovid Trial to Individual A Who Traded on the Tip