According to the New York Times, a former hedge fund manager turned pharmaceutical entrepreneur has purchased the rights to a 62-year-old drug that fights parasitic infections, raising the cost from $13.50 per tablet to $750 overnight.
Martin Shkreli, 32, the founder and chief executive of Turing Pharmaceuticals, bought the drug Daraprim for $55 million on the same day his company announced it had raised $90 million from Shkreli and other investors in its first round of financing.
From The Raw Story:
Daraprim is used for treating toxoplasmosis — an opportunistic parasitic infection that can cause serious or even life-threatening problems in babies and for people with compromised immune systems like AIDS patients and certain cancer patients — that sold for slightly over $1 a tablet several years ago. Prices have increased as the rights to the drug have been passed from one pharmaceutical company to the next, but nothing like the almost 5,500 percent increase since Shkreli acquired it.
“What is it that they are doing differently that has led to this dramatic increase?” Dr. Judith Aberg, chief of infectious diseases at the Icahn School of Medicine at Mount Sinai asked.
Shkreli says Turing will put the extra profits back into research to develop better treatments for toxoplasmosis that have fewer side effects.
“This isn’t the greedy drug company trying to gouge patients, it is us trying to stay in business,” Shkreli explained, saying the drug is used short term and that the new price is competitive with other drugs
“It really doesn’t make sense to get any criticism for this,” he added.
According to the Times report, this isn’t the first time Shkreli has come under fire for his methods.
He started MSMB Capital, a hedge fund company, in his 20s and drew attention for urging the Food and Drug Administration not to approve certain drugs made by companies whose stock he was shorting.
In 2011, Mr. Shkreli started Retrophin, which also acquired old neglected drugs and sharply raised their prices. Retrophin’s board fired Mr. Shkreli a year ago. Last month, it filed a complaint in Federal District Court in Manhattan, accusing him of using Retrophin as a personal piggy bank to pay back angry investors in his hedge fund.
Mr. Shkreli has denied the accusations. He has filed for arbitration against his old company, which he says owes him at least $25 million in severance. “They are sort of concocting this wild and crazy and unlikely story to swindle me out of the money,” he said.
Regarding Shkreli’s claim that the excess profits will go back to research, doctors say that isn’t needed.
“I certainly don’t think this is one of those diseases where we have been clamoring for better therapies,” said Dr. Wendy Armstrong, professor of infectious diseases at Emory University in Atlanta.
Featured image via Twitter
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