Martin Shkreli is best known as the man behind the company responsible for driving up prices on an HIV/AIDS drug by over 5000%
The CEO’s business activities saw Shkreli arrested late last year
Shkreli’s former company, Turing Pharmaceuticals, gained notoriety with its price-hiking tactics, which saw it acquiring essential drugs and placing them out of the bracket of affordability for many patients.
When he established Turing Pharmaceuticals (not long after being asked to leave his previous company, Retrophin) he vague as to the details of his plans: “Our goal is to build a diverse portfolio and pipeline of therapies that can make a significant difference to patients. We are creating a strong, experienced team at Turing with a solid track record of success to execute on our objectives.”
All that changed when Turing acquired the rights to Daraprim, a drug used to treat malaria and toxoplasmosis parasitic infections in pregnant women and patients with HIV. Shkreli became the centre of a media whirlwind when his company hiked the price up to approximately $750 per tablet.
After several months of public backlash, Shkreli was arrested in New York late last year – but on suspicion of offenses entirely unrelated to the price hiking activity.
Instead, it was related to his time as manager of hedge fund MSMB Capital Management and, later, CEO of Retrophin.
Nate Raymond, writing for Reuters in New York said that the arrest was part of a securities fraud probe into the two businesses. Raymond added that "Shkreli, 32, was expected to be charged for illegally using Retrophin assets to pay off debts after MSMB lost millions of dollars".
The news quickly became the leading global trend on Twitter. Author and journalist Jon Ronson tweeted: "Now I'll never get to interview Martin Shkreli, which kind of makes us all victims."
Meanwhile Greg Hogben, a British author and supporter of LGBT and women’s rights tweeted: “Martin Shkreli - man who hiked up price of AIDS drug - arrested. Because Karma is beautiful.”
In the days and weeks that followed, the repercussions of yet more bad press and an arrested became clear.
Firstly, Shkreli’s own Twitter account was targetted by hackers, who posted fake messages, such as “Anyone want free money? Willing to donate hundreds of thousands to charities before I go to prison...”
But there were far more serious events taking place as a result of the press attention. Clinical trials involving drugs from Shkreli’s recently acquired KaloBios pharma company were immediately halted.
The Moffitt Cancer Center said in a statement to CNBC that it was “was among several participating sites of the clinical trial 'Study of KB003 in Previously Treated Patients With Chronic Myelomonocytic Leukemia (CMML)'funded by KaloBios.”
The statement continued: “The biopharmaceutical company holds ownership of the clinical trial and KB003 drug. Moffitt has suspended this clinical trial indefinitely pending the outcome of the investigation of KaloBios' CEO, Martin Shkreli,”
Turing meanwhile was left scrambling to protect its already-damaged reputation. Following the arrest, Shkreli stood down as CEO, and the firm issued an update on its stance on Daraprim. Chairman of the Board at Turing, Ron Tilles, said: "We wish to thank Martin for helping us build Turing Pharmaceuticals into the dynamic research focused company it is today, and wish him the best in his future endeavors. At the same time, I am very excited about the opportunity to guide Turing Pharmaceuticals forward. We remain committed to ensuring that all patients have ready and affordable access to Daraprim and Vecamyl.”
Now, Shkreli’s actions will be scrutinised by congress, but considerable damage has already been done. Turing, for its part, had already unveiled a pricing program for hospitals, giving them access to the drug with discounts of up to 50%.