Martin Shkreli kicked out of pharma and must repay $64.6m
Martin Shkreli, the former pharmaceutical executive best known for shamelessly raising the price of a life-saving drug, is to pay $64.6 million and will be banned for life from the pharmaceutical industry for violating antitrust law, has a federal court ordered on Friday.
Mr Shkreli is serving a seven-year prison sentence for defrauding investors linked to his work as head of two hedge funds and another pharmaceutical company. This conviction has no connection with the drug price saga that raised him to notoriety. He is expected to be released this year.
In 2015, Mr Shkreli – then a pharmaceutical entrepreneur in his early thirties little known outside his industry – acquired a decades-old drug known as Daraprim, which is used to treat a life-threatening parasitic infection, and raised its price to $750. a tablet, starting at $13.50. The move alarmed politicians and the public, who were already worried about rising drug prices and the role pharmaceutical companies can play in making drugs unaffordable.
Most pharmaceutical executives raise prices more quietly and gradually, and confidently to ensure patient access, but Shkreli seemed unrepentant. He became known as the “pharma bro” for his brash attitude in the face of criticism. The BBC called him perhaps “the most hated man in America”.
On Friday, Judge Denise L. Cote of the U.S. District Court for the Southern District of New York ruled that Mr. Shkreli had attempted to maintain a monopoly over Daraprim through anti-competitive tactics. The lawsuit was filed by the Federal Trade Commission and attorneys general from seven states, including New York.
The judge found that Mr. Shkreli violated federal and state antitrust laws and that his former company, now known as Vyera Pharmaceuticals, generated $64.6 million in excess profits from its sales of Daraprim due to this conduct.
The court found that under Mr. Shkreli’s control, Vyera changed the way the drug was distributed and hindered competition in the generic market. Consumers have been harmed by higher prices and fewer options for the drug, “forcing many patients and physicians to make difficult and risky decisions for the treatment of life-threatening illnesses,” the attorney general’s office said. New York in a press release.
In 2020, the Food and Drug Administration approved the first generic version of Daraprim.
The court opinion said that “Mr. Shkreli’s anti-competitive conduct to the detriment of public health was flagrant and reckless”.
Lawyers for Mr. Shkreli did not immediately return a request for comment on Friday.
Mr. Shkreli has repeatedly defended his decision to raise the price of Daraprim, saying the profits would allow his company to develop better antiparasitic drugs. When he was sentenced for his securities fraud conviction, he said he was never motivated by money and made mistakes trying to boost his reputation.
While incarcerated, Mr. Shkreli made headlines.
Around the same time he raised the price of Daraprim, he bought a one-off Wu-Tang Clan album, “Once Upon a Time in Shaolin,” at auction for $2 million. After Mr. Shkreli was found guilty of securities fraud, the government seized the album to pay part of the $7.36 million he owed.
The government announced last summer that it had sold the album but did not reveal a buyer or price. In the fall, a collective operating on the frontier of digital art and cryptocurrency said it purchased the recording for $4 million.
In late 2020, Christie Smythe, a former Bloomberg News reporter who helped uncover the story of Mr Shkreli’s 2015 arrest in the securities case, revealed in an Elle magazine article that she was fell in love with him and that they had been in a romantic relationship. She continued to defend him.
This month, another healthcare entrepreneur, Elizabeth Holmes, founder of blood testing startup Theranos, was found guilty of defrauding investors. His sentencing is set for September 26.