For months, Martin Shkreli, a former hedge fund manager who took over a pharmaceutical company and raised the cost of a critical drug more than fiftyfold, has been the face of corporate greed and immoral business practices. He may soon has a record to go along with his well-earned reputation. Shkreli was arrested on a seven-count indictment alleging that he fraudulently induced investors to invest in two separate funds and misappropriated Retrophin’s assets to satisfy Shkreli’s personal and professional debts. Presumably, if convicted, the judge will not (despite natural temptations) enhance his sentence 50 times simply because he want a higher
profits penalty curve.
Notably, the charges have nothing to do with the disgusting price gouging that Shkreli, 32, demonstrated at his current company, Turing Pharmaceuticals. Shkreli spent $55 million in August for the U.S. rights to sell Daraprim, a 62-year-old drug for a rare parasitic infection, and then raised the price from $13.50 to $750 per pill. The drug is the only approved treatment for toxoplasmosis, a disease that mainly strikes pregnant women, cancer patients and AIDS patients.
After international outcry, Shkreli said the company would cut the price of Daraprim, but then reneged on the promise and said that the company would instead reduce what it charges hospitals for Daraprim by as much as 50 percent. However, the company would still charge insurance companies the full exorbitant price.
Shkreli was quoted as saying that he wished he had raised the price more and that “No one wants to say it, no one’s proud of it, but this is a capitalist society, a capitalist system and capitalist rules. And my investors expect me to maximize profits, not to minimize them or go half or go 70 percent but to go to 100 percent of the profit curve.”
None of the gouging over Daraprim was deemed illegal. Instead the criminal charges instead involve his actions at Retrophin, a company that he ran as CEO from 2012 to 2014. Shkreli is being sued for more than $65 million, by Retrophin accusing him of using his control of the company to enrich himself and to pay off the claims of financial fund investors he had defrauded.
The investigation did not apparently deter Shkreli from spending wildly as the self-described “most eligible bachelor. He recently purchased the only copy of a Wu-Tang Clan album titled “Once Upon a Time in Shaolin,” for $2 million.
Source: New York Times