Shkreli, who is now chief executive officer of Turing Pharmaceuticals and KaloBios Pharmaceuticals Inc, was charged in a federal indictment related to his time managing hedge fund MSMB Capital Management and heading bio-pharmaceutical company Retrophin Inc.

The indictment, filed in Brooklyn, New York, also charged Evan Greebel, a former partner at law firm Katten Muchin Rosenmann who was Retrophin's outside counsel.

Both were also sued in a related lawsuit by the US Securities and Exchange Commission, which also named MSMB Capital as a defendant.

Brooklyn US Attorney Robert Capers is scheduled to hold a press conference with officials from the Federal Bureau of Investigation and SEC at noon EST (1700 GMT) to announce the charges, his office said.

FBI spokeswoman Kelly Langmesser confirmed the arrests of Shkreli and Greebel.

Shares of KaloBios fell 53 percent at USD 11.03 in the premarket before trading in them was halted. Retrophin, which said in a statement that it had fully cooperated with the government investigations of Shkreli, was down 1.5 percent at USD 21.03 at midday.

Latest News  from Business News Desk