Enlarge / Martin Shkreli, former CEO of Turing, smirked his way through a Congressional hearing.CSPAN reader comments 27 with 22 posters participating Share this story Share on Facebook Share on Twitter Share on Reddit Armed with a contraband phone, an incarcerated Martin Shkreli is plotting a comeback with his notorious pharmaceutical company, according to a…
27 with 22 posters participating
Armed with a contraband phone, an incarcerated Martin Shkreli is plotting a comeback with his notorious pharmaceutical company, according to a report byThe Wall Street Journal. So far, however, the company is still losing millions of dollars.
Shkreli is just 16 months into a seven-year prison sentence over securities-fraud charges. He landed in jail last year for running what federal prosecutors described as a Ponzi-like scheme that duped investors of his hedge funds. According to prosecutors, the fund siphoned millions from a pharmaceutical company he founded, called Retrophin.
But Ponzi-siphoning isn’t what made Shkreli infamous. He gained notoriety in 2015 whenanotherpharmaceutical company he founded, Turing Pharmaceuticals, bought the rights to a decades-old anti-parasitic drug, Daraprim, and abruptly increased its price from $13.50 a pill to $750 a pill. The rise brought a windfall of profits for Turing, as well as widespread condemnation and increased scrutiny on the pharmaceutical industry’s drug-pricing tactics as a whole.
Amid the federal charges and conviction, Shkreli stepped down as Turing’s CEO, and the company tried to distance itself from the disgraced executive. It changed its name twice—first to Vyera, then to Phoenixus, its current name.
Though Phoenixus didn’t lower Daraprim’s price, it’s no longer paying off. Daraprim sales began slipping amid public backlash and competition. Last year, the company lost $1.2 million in the first quarter. And things apparently haven’t improved since then, according theWSJ. The company’s third-quarter financial statement indicated a year-to-date $10.3 million net loss, leaving $37.7 million in cash.
This doesn’t seem to have deterred Shkreli. He is reportedly working diligently on making a pharmaceutical comeback once he is released from prison in 2023. By his calculations, Phoenixus could be worth $3.7 billion by that time, up from his generous 2017 estimate of $500 million. With a contraband phone and access to biomedical studies on prison computers, Shkreli is said to be calling shots. He is (allegedly) advising Phoenixus officials and making deals to get the company more money makers like Daraprim.
In September, Shkreli oversaw a $20 million deal with Orphan Star Therapeutics LLC, which will go toward developing drugs for rare diseases. In January, Phoenixus licensed a drug to a company called Seelos for $1.5 million and 250,000 Seelos shares.
Phoenixus investors—including French financier Bertrand des Pallieres—are wary of the deals, and they are pushing for more transparency. “We suspect a lot of self-dealing,” des Pallieres told theWSJ.
Conducting business from within prison is prohibited. According to company associates, the Federal Bureau of Investigation is reportedly looking into Shkreli’s involvement at Phoenixus.