Martin Shkreli: From Pharma Bro to Prison

New Thread

Ctrl

Home

Discover

Try Pro

Upgrade for image upload, smarter AI, and more Pro Search.

nytimes.com

Introduction
Early Life and Career
The Daraprim Price Hike Controversy
Shkreli's Early Prison Release
Wu-Tang Album Saga
Historic Moment: Wu-Tang Clan's Unique Album to Be Played Publicly
Closing Thoughts

Martin Shkreli: From Pharma Bro to Prison

Curated by

cdteliot

4 min read

11,307

Martin Shkreli, a former pharmaceutical executive known as "Pharma Bro," has been banned for life from the pharmaceutical industry after being convicted of securities fraud and orchestrating an illegal scheme to monopolize a lifesaving drug. The ban, along with a $64.6 million fine, was recently upheld by a federal appeals court.

Early Life and Career

news.com.au

Martin Shkreli was born in 1983 in Brooklyn, New York to immigrant parents from Albania and Croatia. As a teenager, he played chess with an older man in his building who taught him about biotech stocks, sparking his interest in investing. Shkreli attended Hunter College High School but reportedly did not graduate. At age 17, he interned for CNBC's Jim Cramer at his hedge fund. Shkreli earned a business degree from Baruch College in 2004 and worked at UBS and Intrepid Capital Management. In 2009, he founded the hedge fund MSMB Capital Management, where he gained attention for shorting biotech stocks and criticizing the companies on social media. In 2011, Shkreli founded the pharmaceutical company Retrophin. However, MSMB Capital was virtually wiped out that same year after a disastrous short sale trade on Orexigen Therapeutics. Prior to the infamous Daraprim price hike in 2015, Shkreli had a history of controversial moves, including urging the FDA to reject drugs from companies whose stocks he was shorting. Retrophin later sued Shkreli for $65 million, alleging he used company funds to pay off MSMB investors. Despite these red flags, Shkreli's early career was marked by precocious talent and bold, if sometimes reckless, ambition in the biotech investing space.

4 sources

The Daraprim Price Hike Controversy

In 2015, Turing Pharmaceuticals, led by CEO Martin Shkreli, acquired the rights to Daraprim, a 62-year-old medication used to treat toxoplasmosis, a parasitic infection that can be fatal for individuals with compromised immune systems, such as AIDS patients. Turing promptly raised the price of a single Daraprim pill from $13.50 to $750, a staggering 5,000% increase. The pill costs about $1 to produce. Shkreli defended the price hike, claiming the revenue would be used to finance research and development of new treatments. However, critics argued the increase was unjustifiable and unsustainable for the healthcare system, particularly for the medically vulnerable patients who rely on the drug. Dr. Wendy Armstrong of the HIV Medicine Association questioned the need for new treatments, stating, "This is not an infection where we have been looking for more effective drugs." The controversy sparked widespread criticism, with healthcare providers and patient advocacy groups urging Turing to reconsider. It also caught the attention of politicians, with Hillary Clinton pledging to take action against firms hiking prices for specialty drugs and calling out Daraprim as an example of "price gouging." The Daraprim price hike controversy highlighted issues with drug pricing in the U.S. and the potential for companies to engage in price gouging, particularly for medications with small patient populations and limited competition. It sparked discussions about the need for reforms to prevent such drastic price increases and ensure access to essential medications.

3 sources

Shkreli's Early Prison Release

apnews.com

Martin Shkreli, known as "Pharma Bro," was sentenced to seven years in federal prison in March 2018 after being convicted of securities fraud. He served his sentence at the Federal Correctional Institution in Allenwood, Pennsylvania until May 2022, when he was released early to a halfway house in New York. During his time in prison, Shkreli was reported to have been placed in solitary confinement after prison officials discovered him using a contraband cellphone to conduct business, including allegedly firing the CEO of his drug company, Phoenixus AG (formerly Turing Pharmaceuticals). Shkreli completed prison programs that allowed for his sentence to be shortened, leading to his early release after serving about four years. With his transfer to community confinement, Shkreli is projected to be released from federal custody on September 14, 2022. Despite his early release, he remains barred for life from serving in any capacity in the pharmaceutical industry and from running a public company as part of his criminal conviction.

5 sources

Wu-Tang Album Saga

pitchfork.com

In 2015, Martin Shkreli purchased the sole copy of the Wu-Tang Clan album "Once Upon a Time in Shaolin" at auction for a reported $2 million. The album was promoted as a unique work of art with no physical or digital duplicate. Following Shkreli's conviction for securities fraud in 2018, he was forced to forfeit the album as part of a $7.4 million judgment. In July 2021, the U.S. government sold the album to an undisclosed buyer for $4 million. The album was later revealed to have been purchased by PleasrDAO, a collective known for acquiring high-profile digital works. In 2024, it was announced that the album would be played for the public for the first time at the Museum of Old and New Art (Mona) in Tasmania as part of an exhibition on status, celebrity, and notoriety.

5 sources

Historic Moment: Wu-Tang Clan's Unique Album to Be Played Publicly

designboom.com

In June 2024, the Museum of Old and New Art (Mona) in Tasmania will publicly play the Wu-Tang Clan's album "Once Upon a Time in Shaolin" for the first time. The album, often referred to as the world's rarest and most valuable, was famously purchased by Martin Shkreli for $2 million in 2015. After Shkreli's conviction for securities fraud, the U.S. government seized and sold the album to an anonymous buyer in 2021. It was later revealed that the album had been acquired by digital art collective PleasrDAO for $4 million. Mona has now obtained the album on loan for its upcoming exhibition "Namedropping," which explores themes of status, celebrity, and notoriety. The public listening parties for this mythical album mark a significant moment in its storied history.

4 sources

Closing Thoughts

Martin Shkreli's early release from prison in May 2022 has not diminished the enduring impact of his controversial actions in the pharmaceutical industry. In January, a federal court upheld a lifetime ban on Shkreli's involvement in the pharmaceutical sector and a $64.6 million fine for his anticompetitive behavior in hiking the price of the lifesaving drug Daraprim by 5,000% in 2015. The court's decision aimed to protect the public from Shkreli's demonstrated pattern of monopolistic practices, illegal business conduct, and fraud. Despite completing prison programs that allowed for a shortened sentence for his securities fraud conviction, Shkreli's reputation as the notorious "Pharma Bro" endures due to his unapologetic defense of the Daraprim price hike and his history of financial misconduct. As reported by major news outlets including BBC News, Bloomberg News, ABC News, and CBS News, Shkreli's case has come to symbolize the need for greater scrutiny and regulation of the pharmaceutical industry to prevent similar instances of price gouging and anticompetitive behavior that can harm vulnerable patients and the healthcare system as a whole.