York, FTC sue 'pharma bro' Shkreli, others over Daraprim price hikes
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[January 28, 2020]
By Diane Bartz
WASHINGTON (Reuters) - Martin Shkreli, the
"pharma bro" in prison for defrauding investors, faces a lawsuit filed
by the Federal Trade Commission and New York attorney general's office
for an alleged scheme to preserve his monopoly for the drug Daraprim,
whose price increased by more than 4,000% in one day.
The lawsuit accuses a company that Shkreli once ran of buying the
rights in 2015 to Daraprim, which is used to treat toxoplasmosis - a
disease resulting from infection with a parasite - and quickly
raising the price from $17.50 per tablet to $750 while taking steps
to ensure there would not be a cheaper generic version of the
The company named is Vyera Pharmaceuticals, formerly Turing
Pharmaceuticals, which was headed by Shkreli.
"We filed this lawsuit to stop Vyera’s egregious conduct, make the
company pay for its illegal scheming, and block Martin Shkreli from
ever working in the pharmaceutical industry again," New York
Attorney General Letitia James said in a statement. "We won’t allow
'pharma bros' to manipulate the market and line their pockets at the
expense of vulnerable patients and the health care system."
Shkreli, who is in prison in Pennsylvania, became notorious as "Pharma
Bro" when he sharply raised the price of Daraprim while chief
executive of Turing Pharmaceuticals.
Vyera Pharmaceuticals said in a statement that the claims "are
without merit and will vigorously defend these claims in court."
The lawsuit also names Shkreli associate Kevin Mulleady, the FTC
said. The FTC and the New York attorney general's office are seeking
monetary relief for people who overpaid for the medicine and an
order requiring the company to halt illegal conduct.
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A lawyer for Shkreli, 36, did not respond to a request for comment.
Shkreli is slated for release in September 2023, according to the
Federal Bureau of Prisons.
The FTC alleged that the company protected its dominance of the drug
by restricting distribution to ensure generic drug makers could not
get the samples needed to make their own version of the drug. The
company also prevented potential competitors from buying one of the
medicine's ingredients, the FTC said.
The U.S. Supreme Court said in November that Shkreli must remain in
prison, rejecting his effort to overturn his conviction and
seven-year sentence for securities fraud and conspiracy.
The justices refused to hear Shkreli's appeal of his August 2017
conviction and $7.36 million forfeiture for cheating investors in
two hedge funds he founded, and trying to prop up the stock price of
biotechnology company Retrophin Inc, which he once ran.
(Reporting by Diane Bartz; Editing by David Gregorio and Leslie
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