(Bloomberg) -- Deerfield Management, a $7 billion firm that invests in health care companies, has received a subpoena from U.S. authorities over its relationship with the founder of a Washington political-intelligence company, according to a person with direct knowledge of the matter.
Deerfield told investors in an Oct. 27 letter that the government's request relates to its dealings with David Blaszczak, the founder of Precipio Health Strategies, said the person who asked not to be named because the New York-based firm is private. Deerfield buys shares of health-care companies and also makes private equity investments, according to its website.
Deerfield officials declined to comment on the U.S. subpoena.
In its letter to investors, Deerfield said it's one of many companies that have received services from Blaszczak and that the government's interest in him has been documented in media reports, the person said. Blaszczak, a former federal employee at the Center for Medicare and Medicaid Services, is the focus of a U.S. investigation, the Wall Street Journal reported in August, citing people familiar with the probe.
Calls to Blaszczak from Bloomberg News weren't immediately returned.
The Justice Department and SEC have been cracking down on hedge funds' use of firms that are paid to offer insights on industry trends and Washington policy that could move stock prices.
As part of a six-year nationwide probe, prosecutors have pursued cases in which so-called expert networks provided inside information on financial results of public companies. In June, the Justice Department and SEC accused a consultant named Gordon Johnston of providing illegal tips to hedge fund Visium Asset Management that he had received from a former colleague at the Food and Drug Administration. Johnston is cooperating with the government.
Blaszczak played a role in the government's investigation into Visium, according to the Wall Street Journal's August article. He is allegedly a “co-conspirator” and “political consultant” who helped the hedge fund make $285,000 in profits with non-public information tied to health-care spending cuts, the Journal reported. The newspaper said Blaszczak and his lawyer didn't respond to requests for comment.