Martin Shkreli has resigned as chief executive of Turing Pharmaceuticals following his arrest on Thursday.
Ron Tilles will become interim chief executive after Mr Shkreli was accused of securities fraud in relation to a drug company and a hedge fund he managed.
Mr Shkreli, 32, was accused of running a Ponzi scheme at his former company.
Turing and Mr Shkreli became infamous in the US for raising the price of an HIV drug by 5,000% earlier this year.
His arrest was unrelated to this price rise.
US prosecutors said on Thursday that "Shkreli engaged in multiple schemes to ensnare investors through a web of lies and deceit".
The FBI has accused Mr Shkreli of running a Ponzi scheme, in which assets from his former company, Retrophin, were illegally used to pay off debts at MSMB, the hedge fund he managed.
The US Securities and Exchange Commission also charged him with defrauding investors in MSMB to conceal poor investment choices.
The SEC also accused Mr Shkreli of taking money from the hedge fund to use for personal expenses.
Mr Shkreli denied the charges in court and was released on bail of $5m.
Mr Tilles has been chairman of Turing since the company was founded last year.
He thanked Mr Shkreli for helping to make Turing the "dynamic, research-focused company it is today and wish him the best in his future endeavours".
Mr Tilles has worked with private equity and venture capital firms in the pharmaceutical and medical device industry for the past 20 years.
Turing and Mr Shkreli drew criticism in September when the company raised the price of an HIV drug called Daraprim from $13.50 to $750 per pill - a 5,000% increase.
Mr Shkreli was lambasted for the decision, but accused the public and politicians of not understanding the industry.
He later said the company would lower the price. However, Turing kept the price of Daraprim the same, offering discounts to hospital and financial aid for some customers.
On Friday Mr Tilles vowed to make the drug affordable: "We remain committed to ensuring that all patients have ready and affordable access to Daraprim."
Turing paid $55m for the rights to sell the drug in the US.
Mr Shkreli recently became chief executive of another company, San Francisco-based KaloBios Pharmaceuticals. It was unclear whether he would retain that position.