Just weeks after Martin Shkreli became the most hated man in America for hiking the price of a life-saving drug five thousand percent, the pharmaceutical CEO was arrested on charges of fraud. And today it has been revealed that Martin Shkreli has officially resigned as the chief executive of Turing Pharmaceuticals.
According to the New York Times, the alleged securities fraud that led to Martin Shkreli’s arrest was committed before his time at Turing Pharmaceuticals. Shkreli’s alleged crimes were reported to have occurred during the years he ran a hedge fund and worked at Retrophin. Strangely, the man who will temporarily replace Martin Shkreli as CEO of Turing Pharmaceuticals, Ron Tilles, was a co-founder of Retrophin. So far, Turing Pharmaceuticals has not acknowledged this connection.
According to USA Today, Martin Shkreli’s fraudulent behavior included misappropriation of funds, lying about investment returns, and conspiracy to defraud Retrophin. Despite Shkreli’s alleged crimes against Tilles’ former company, the interim CEO of Turing Pharmaceuticals was nothing but courteous toward Shkreli in a statement.
“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.”
According to Bloomberg, Martin Shkreli vehemently denied the charges of securities fraud on Thursday. He has since been released on a $5 million bond.
According to the complaint filed against Martin Shkreli by Securities and Exchange Commission, the former CEO of Turing Pharmaceuticals had been tricking investors since he began managing money in his twenties. At one point, he allegedly convinced investors to give his company $3 million even though he only had $331 to his name.
Martin Shkreli moved from company to company regularly throughout his career, which was reported by law enforcement to be one of the tactics he used to avoid detection as he defrauded various investors.
“Shkreli essentially ran his company like a Ponzi scheme where he used each subsequent company to pay off defrauded investors from the prior company,” said U.S. Attorney Robert Capers.
Since then, the face of Turing Pharmaceuticals has made a reputation for himself for being cocky and unapologetic for his apparent greed and his wealthy lifestyle, while he earned the nickname, “Pharma bro.”
After the infamous price gouging incident, in which he jacked up the cost of a Turing Pharmaceuticals drug five thousand percent, Martin Shkreli’s only explanation was that he did it to “turn a profit on the drug.” And at a Forbes summit in New York earlier this month, Martin Shkreli admitted he would do it again.
“I probably would have raised the price higher,” he said. “My investors expect me to maximize profits.”
A Turing Pharmaceuticals investor who wished to remain anonymous claimed that the indictment against Martin Shkreli made it impossible for him to run the private New York company without doing damage to the company’s business.
“I don’t see how he can run this company anymore. There’s no way it doesn’t hurt the company.”
While the public may feel vindicated to see Martin Shkreli indicted, the securities fraud he’s been accused of has nothing at all to do with the Turing Pharmaceuticals price gouging that turned him into “the most hated man in America.” In fact, a spokesperson for Martin Shkreli claims that the charges were intentionally pressed as a result of the animosity that so many citizens feel toward him.
“It is no coincidence that these charges, the result of investigations which have been languishing for considerable time, have been filed at the same time of Shkreli’s high-profile, controversial and yet unrelated activities.”
What do you think? Should drug manufacturers be governed only by profits, or should the public good enter into their business plans?
(Photo by Andrew Burton/Getty Images)