Valvani, a native of Kalamazoo, Michigan, and son of Indian immigrants, worked at Visium since its inception in 2005 and was a partner at the firm.

His ties to Gottlieb -- a trained medical doctor -- go back further. In 2003, Valvani, then a sell-side associate in health care at Salomon Smith Barney, joined Gottlieb as an analyst at Balyasny Asset Management. Gottlieb was a money manager there, according to an alumni profile of Valvani by Duke University’s Fuqua School of Business. Two years later, Gottlieb spun out his health-care strategy, bringing along a team of 20 investment professionals including Valvani.

“I really had to convince Jacob Gottlieb that I was hungry to join his hedge fund,” Valvani, who joined Balyasny in 2003, said in the Duke profile. “I work hard and try to be the best at what I do, which is why a hedge fund is so suitable for me -- here I have a lot of control over my own destiny.”

Health-Care Expertise

Gottlieb’s health-care expertise was the draw of his main fund, Visium Balanced Fund. The hedge fund had grown to $2 billion by the end of 2007. The strategy, which includes performance before Gottlieb started Visium, gained an annual average of 13.5 percent since its 2001 inception through the first quarter of this year, according to an investor letter obtained by Bloomberg.

Valvani ran part of that fund, overseeing a portfolio of specialty-pharmaceutical stocks. His performance was so good that rivals at other hedge funds would question Visium employees at conferences about Valvani’s confidence in his trades, a former colleague said. Valvani managed as much as $2 billion, including borrowed money, before he was put on leave in April.

Gottlieb soon started to expand the firm beyond health-care stocks. In 2009, Visium launched a standalone multistrategy fund, called Visium Global, and a credit pool. As of last year, it managed five hedge funds and a mutual fund, and was seeking to raise $500 million for a private equity vehicle.

Exploring a Sale

“We’re committed to running a very high-quality, high-integrity firm,” Gottlieb told Institutional Investor in a 2012 interview in which he outlined his ambition to build a multiproduct and multistrategy investment giant.

Visium first told investors in March that it was being investigated by the government for its use of a consultant and trading in certain securities as well as the valuation of a credit fund that closed in 2013.