Mathew Martoma, 39 was convicted on one count of conspiracy to commit securities fraud and two counts of securities fraud.
Following the conviction, Manhattan US Attorney Preet Bharara said in a statement that Martoma cultivated and purchased the confidence of doctors with secret knowledge of an experimental Alzheimer's drug, and used it to engage in illegal insider trading.
"Martoma bought the answer sheet before the exam - more than once - netting a quarter billion dollars in profits and losses avoided for SAC, as well as a USD 9 million bonus for him. In the short run, cheating may have been profitable for Martoma, but in the end, it made him a convicted felon, and likely will result in the forfeiture of his illegal windfall and the loss of his liberty," Bharara said in a statement.
Martoma becomes the 79th person convicted of insider trading after trial or by guilty plea for charges brought by Bhararas office in the last four years.
His lawyer Richard Strassberg said after the verdict that, "Were very disappointed and we plan to appeal."
The case is brought by Bharara, who has alleged in the criminal compliant that Martoma exploited his personal and financial relations with a leading doctor Sidney Gilman to make profits and avoid losses for SAC in an amount totalling approximately USD 276 million.
Gilman, who chaired the Safety Monitoring Committee (SMC) for the clinical trial, testified for the government that he gave Martoma an advance look at the final results weeks before they were made public.
Martoma is the son of Indian immigrants and faces as many as 20 years in prison on the securities fraud charges and five years on the conspiracy charge if convicted.
He was arrested in November 2012 from his home in Boca Raton, Florida and has been free on a five million dollar bail.
In their closing arguments, prosecutors said Martoma pursued a "canary in a coal mine" to give him an "illegal sneak preview" of the results of the clinical Alzheimers drug trial. They said he built and harboured relationships with two doctors, including 81-year old Gilman.
Prosecutors said Martoma's relationships with the doctors "paid off in the most dramatic way" when he used the information to trade before Elan announced its negative trial results. This led SAC to avoid losses and make profits totalling USD 275 million.
The defence however countered that the government's case against Martoma was "fatally flawed" because it relied on the Gilman's "totally unbelievable" memory.
Gilman, a former University of Michigan professor, showed signs of a faltering memory when he was on the witness stand.
Bharara has led the government's massive crackdown on insider trading and won convictions against prominent Wall Street executives like ex-Goldman director Rajat Gupta and billionaire hedge fund founder Raj Rajaratnam.
A Stanford graduate, Martoma joined SAC Capital Advisers in 2006 and had worked with the firm's affiliate CR Intrinsic Investors.