Turing Pharmaceuticals CEO Martin Shkreli Arrested .........

[GURPS]

Turing Pharmaceuticals CEO Martin Shkreli Arrested for Securities and Wire Fraud


Turing Pharmaceuticals CEO and former hedge fund manager Martin Shkreli, who was heavily criticized for raising the price of a drug used to treat a life-threatening infection by more than 4,000 percent, is facing multiple charges of securities and wire fraud in what federal prosecutors call a “Ponzi scheme” that stretched on for years.

Robert Capers, United States Attorney for the Eastern District of New York, told reporters today that Shkreli allegedly defrauded investors in two hedge funds, MSMB Capital and MSMB Healthcare, and also plundered Retrophin, the biopharmaceutical company he ran as its CEO, in an effort to pay back debts related to the now-defunct hedge funds.

Prosecutors allege that Shkreli lost all of the investments in MSMB Capital but continued to provide inflated and false performance updates to its investors. According to the indictment, Shkreli told one investor that the value of his $1.25 million investment was now worth slightly more than $1.3 million, even though MSMB Capital had ceased trading almost a year before and had no assets.

“Shkreli essentially ran his company like a Ponzi scheme,” Capers told reporters, explaining that Shkreli then allegedly concealed the collapse of MSMB Capital from potential clients in order to get them to invest in MSMB Healthcare. Capers explained that Shkreli next proceeded to allegedly use the money invested in MSMB Healthcare to pay off his previous debts. He is also accused of creating fraudulent transactions of money out of Retrophin in order to pay off personal and professional debts. Prosecutors say, as a result, Retrophin and its investors lost in excess of $11 million.

Is this a case of 'any good DA could indite a ham sandwich' aka a matter of perspective / interpretation - and therefore payback for raising the that drug price by 4000 %

or was the guy really shady

 

[LibertyBeacon]

or was the guy really shady

Is there anything shady about using the power and force of government (in this case there was a patent) to protect and in fact enhance one's income stream?

If one believes in patents, what is the objection to what this kid did? He saw a drug was very possibly under priced, bought the rights to it, and raised the price.

I'm sure you know it happens all the time; this is the basis for commerce. Buy low, sell high.

 

[Tilted]

Is this a case of 'any good DA could indite a ham sandwich' aka a matter of perspective / interpretation - and therefore payback for raising the that drug price by 4000 %

or was the guy really shady

Shady, I think, though I have little idea whether the current charges are justified.

Mr. Shkreli may have only come onto mainstream radar recently with the Daraprim price-raising controversy, but he'd been on the radar in the business / pharma world (albeit not to any grand degree) for some time because of other dealings he's had. And he's being sued by the last company he was with.

The current allegations aren't related to the raising of the price of Daraprim . He's been under investigation since before the brouhaha surrounding that. That said, perhaps the decision for the grand jury to bring these charges, or to bring them at this time, has something to do with the public attention he got from that; but I wouldn't assume that's the case.

 

[Tilted]

Is there anything shady about using the power and force of government (in this case there was a patent) to protect and in fact enhance one's income stream?

If one believes in patents, what is the objection to what this kid did? He saw a drug was very possibly under priced, bought the rights to it, and raised the price.

I'm sure you know it happens all the time; this is the basis for commerce. Buy low, sell high.

If you're referring to the price raising that got so much public attention, the issue wasn't that it was protected by a patent and thus he could raise the price significantly without having to worry about competition. The patent for that drug had long since expired.

The issue is how much it costs in some cases to get a license (from the FDA) to manufacture a given drug - even a generic version of an out-of-patent drug. There was so little demand for the drug we're talking about that it hadn't been seen as worth it for someone else to try to produce a generic version of it because the start-up costs (owing in part to licensing costs) weren't justified by the expected revenue stream. (It's an important drug if you have a particular kind of infection, but it's not a kind of infection that affects a lot of people annually.)

After they announced the price increase, and then waffled on that in various ways, someone else (I don't recall the name of the organization) figured out a way to get around the manufacturing license issue (by using a compounded version, IIRC) and was (or planned to) offer the drug for about $1 a pill.

 

[b23hqb]

If you're referring to the price raising that got so much public attention, the issue wasn't that it was protected by a patent and thus he could raise the price significantly without having to worry about competition. The patent for that drug had long since expired.

The issue is how much it costs in some cases to get a license (from the FDA) to manufacture a given drug - even a generic version of an out-of-patent drug. There was so little demand for the drug we're talking about that it hadn't been seen as worth it for someone else to try to produce a generic version of it because the start-up costs (owing in part to licensing costs) weren't justified by the expected revenue stream. (It's an important drug if you have a particular kind of infection, but it's not a kind of infection that affects a lot of people annually.)

After they announced the price increase, and then waffled on that in various ways, someone else (I don't recall the name of the organization) figured out a way to get around the manufacturing license issue (by using a compounded version, IIRC) and was (or planned to) offer the drug for about $1 a pill.

It costs a ton to get one new drug to market. If your company works on developing just one and it gets ok'd by the FDA, the cost is about $350,000,000. That would be a lucky shot.

But for big pharma that is working on multiple drugs always, the cost soars due to the failure rate of most drugs to either work or get approved. The successful drug can reach $5,500,000,000, factoring in the costs for the failed experiments. That's right - $5.5 Billion.

And that was two years ago. With Obamacare and more regulation, no reason why anything has changed.

http://www.forbes.com/sites/matthew...-new-drugs-is-shaping-the-future-of-medicine/

"Sixty-six of the 98 companies studied launched only one drug this decade. The costs borne by these companies can be taken as a rough estimate of what it takes to develop a single drug. The median cost per drug for these singletons was $350 million. But for companies that approve more drugs, the cost per drug goes up – way up – until it hits $5.5 billion for companies that have brought to market between eight and 13 medicines over a decade.


Number of drugs approved R&D cost per drug ($MIL)
Median Mean
8 to 13 5459 5998
4 to 6 5151 5052
2 to 3 1803 2303
1 351 953
Sources: Innothink Center For Research In Biomedical Innovation; FactSet Systems.

Things that work do have a cost associated with it.

 

[GWguy]

He gave up his CEO post. Sounds to me like they are not sorry to see him go.

http://money.cnn.com/2015/12/18/investing/martin-shkreli-arrest-turing-kalobios/index.html

Martin Shkreli, the biotech bad boy who was indicted for securities fraud on Thursday, has stepped down as CEO of Turing Pharmaceuticals.

Turing announced Friday that its chairman Ron Tilles will take over as CEO on an interim basis. Tilles thanked Shkreli in a statement and added that the company wishes him "the best in his future endeavors."

 

[b23hqb]

He gave up his CEO post. Sounds to me like they are not sorry to see him go.

http://money.cnn.com/2015/12/18/investing/martin-shkreli-arrest-turing-kalobios/index.html

Perhaps a little nudge out the door as well as a "thank you for participating!".

 

[GURPS]

Shady, I think, though I have little idea whether the current charges are justified.