Steven A. Cohen's SAC Capital Advisors LP is at the center of the biggest insider case ever filed in a sweeping U.S. crackdown on illicit hedge fund trading — one that focuses on the burgeoning exploitation of secret information on volatile health care stocks.

In doing so, the new case against a former Cohen lieutenant has brought the five year probe beyond the realm of technology stocks and into the busy underworld of health care industry securities fraud. The charges against former SAC portfolio manager Mathew Martoma also place U.S. prosecutors closer than ever to Cohen, the hedge fund's billionaire owner and founder, in the broadest probe of insider trading in a generation.

Martoma, 38, was accused by prosecutors in Manhattan federal court with playing a lead role in what they called the most lucrative insider-trading scheme in history, given the $276 million profit he allegedly helped the hedge fund achieve. Martoma participated in trading on insider tips about clinical trials of a drug to treat Alzheimer's disease, the U.S. said, and advised Cohen to sell shares of Wyeth LLC and Elan Corp. before bad news about its prospects was announced. The government referred to the “hedge-fund owner” in court papers.