Topline
The Federal Trade Commission is asking a federal judge to sanction former hedge fund manager Martin Shkreli, arguing he should be held in contempt for violating his lifetime ban from the pharmaceutical industry by founding a company named Druglike, touted as a “drug discovery platform.”
Former pharmaceutical executive Martin Shkreli speaks to the media in front of U.S. District Court … [+]
Key Facts
Shkreli was ordered in January 2022 to pay a $64.6 million fine and was barred for life from the pharmaceutical industry, as a federal judge found his company Vyera Pharmaceuticals (previously known as Turing Pharmaceuticals) had used anticompetitive practices to illegally force a monopoly over the lifesaving drug Daraprim and harm generic competitors.
The FTC argued in a court filing Friday that Shkreli is violating the terms of that order, which required him to provide regular compliance reports and barred him from “directly or indirectly participating in any manner in the pharmaceutical industry,” in addition to paying the fine.
Shkreli has so far “paid nothing” toward the $64.6 million he owes, which he was required to pay by March 6, 2022, the FTC alleges, and noted that in July Shkreli founded Druglike, described as a “Web3 drug discovery platform.”
He has so far not submitted any compliance reports as required so that the FTC can assess whether his involvement with Druglike violates the ban, the FTC alleged, calling his noncompliance with the court’s order “clear and unambiguous.”
The agency is asking the court to hold Shkreli in contempt and sanction him for not complying with the order, but did not specify what sanctions it believes the court should impose.
Shkreli’s attorney Benjamin Brafman declined to comment to Forbes on the filing.
Big Number
$750. That’s how much Shkreli raised the price of a tablet of Daraprim, up from $17.50—a more than 4,000% increase—before Vyera purchased the drug, according to the court order imposing the fine and lifetime ban on Shkreli.
Contra
Shkreli has defended the price hike of Daraprim, an anti-parasitic drug used to treat the parasite infection toxoplasmosis and often used by people infected with HIV. He claimed to NBC News in 2015 that his company was using the money from the inflated price to develop better treatments that had fewer side effects, though ultimately lowered the drug price in response to the public outrage over his actions.
Key Background
Shkreli gained national notoriety for his drastic increase of the price of Daraprim, becoming known as the “pharma bro” and dubbed the “most hated man in America” for his brazen attitude toward the price hike. The FTC and seven states sued Shkreli in January 2020 for violating federal and state antitrust laws, alleging that Vyera Pharmaceuticals used tactics to stifle competition like restricting distribution of Daraprim so other companies wouldn’t be able to obtain pills to develop generic versions of it, and blocking access to a critical ingredient needed to manufacture the drug. The fine and lifetime ban was imposed on Shkreli following a trial in December 2021 over the antitrust violations, and the FTC’s request for sanctions comes after Shkreli was already ordered to pay over $800,000 in attorneys fees to states who brought the lawsuit alongside the federal government. In addition to the FTC’s antitrust lawsuit, Shkreli was separately found guilty of securities fraud in 2017 unrelated to the Daraprim controversy, and was sentenced to seven years in prison. He was ultimately released early in May 2022.
Further Reading
Martin Shkreli is barred from the drug industry and ordered to repay $64.6 million. (New York Times)
Authorities Seek Lifetime Ban For ‘Pharma Bro’ Martin Shkreli In New Lawsuit (Forbes)
‘Pharma Bro’ Martin Shkreli Released From Prison Early (Forbes)
‘Pharma Bro’ Shkreli Plots Post-Jail NYC Return—Seeks Home In ‘Dope Building With Sick Views’ (Forbes)
Source: https://www.forbes.com/sites/alisondurkee/2023/01/20/pharma-bro-shkreli-violated-lifetime-ban-and-should-be-sanctioned-ftc-says/