From a hedge fund manager to a pharmaceutical company's Chief Executive Officer (CEO) to the most hated man in America, Martin Shkreli went through it all in 10 years and the wheel is still pushing him towards the bottom as more affiliations he has are abandoning him after getting arrested on Dec. 17 on grounds of securities fraud.
Just who is Martin Shkreli and what makes this so-called "Pharma Bro" so interesting to the public eye and pharmaceutical industry right now?
A Glimpse of Shkreli's Background
Martin Shkreli grew up, studied and is a resident of Brooklyn, New York. He received his business degree from Baruch's College in 2004 and, in 2006, he started his own hedge fund called Elea Capital Management which only survived for a year. Elea Capital Management's closure was due to a lawsuit by Lehman Brothers, which collapsed during the 2008 financial crisis. Following the closure, Shkreli founded MSMB Capital Management in 2009 only for it to also be shut down in 2012.
Pharmaceutical Forays
Shkreli founded his first Biotechnology firm in 2011 under the name Retrophin and its goal was to develop medicines for rare diseases. His stint in the company didn't last long, though, because Shkreli was accused of mismanaging the company's funds and he was overthrown in 2014. However, Shkreli refused to leave the pharmaceuticals industry and, in February 2015, he launched Turing Pharmaceuticals.
"Turing Pharmaceuticals is a fully integrated biopharmaceutical company focusing on patients with unmet medical needs," the website explains.
It seems like things are going "well" for Shkreli again on the months that followed but he teased Karma again when he unapologetically raised the price of Daraprim, a drug used to treat Cancer and Human Immunodeficiency Virus (HIV), 5000%. Specifically, the drug went from $13.50 to $750. Protests ensued, of course and he finally agreed to lower the price again by up to 50% in November.
Also in November, Shkreli bought the majority shares of KaloBios, which was on the verge of bankruptcy, and named himself the CEO.
Shkreli's Arrest
Martin Shkreli was arrested on grounds of securities fraud and, while it is KaloBios' stock that is currently frozen, the company had no active involvement regarding the case. The arrest had to do with Shkreli's first Pharmaceuticals foray, Retrophin and his old hedge fund's investors. Investors protested that Shkreli had deliberately misled them and Retrophin accused him of using the company's assets to pay off the investors from his previous company, even filing a lawsuit of $65 Million against him.
"As alleged in the indictment, Shkreli essentially ran his companies like a Ponzi scheme, where he used each subsequent company to pay off the defrauded investors in the prior company," U.S. Attorney Robert Capers said.
Shkreli, however, denied all the charges filed against him and maintains that all the allegations are baseless.
I am confident I will prevail. The allegations against me are baseless and without merit.
— Martin Shkreli (@MartinShkreli) December 19, 2015
He was released on a $5 Million bond and his passport was confiscated.
Shkreli was not alone
Another troubling detail about Shkreli's arrest is that Evan Greebel, a lawyer he worked with was also charged as an accomplice to the fraud, though he also denied the allegation and pleaded not guilty. He was released on a $1 Million bail with travel restrictions. However, that's not the end of his worries. A spokesperson from Kay Scholer, the law firm Greebel works in said that they will also investigate his involvement in the case.
"We are deeply concerned that these charges have been made against Mr. Greebel... We are conducting our own internal investigation, and based on our findings we will take appropriate action," the spokeswoman said.
Pharmaceutical Companies: A Future without Shkreli
Just a day after his arrest, on Dec. 18, Shkreli stepped down as Turing Pharmaceutical's CEO. Turing's current interim CEO is now Ron Tilles, the company's Chairman of the Board. KaloBios also didn't want anything to do with Shkreli and announced that it fired the CEO on Dec. 21.
Martin Shkreli and Evan Greebel will be back in court in January.
