Martin Shkreli might still be in the public eye thanks to his tweets requesting exclusive rights to Kanye West’s new album, but businesses that he ran have quickly faded from the public’s attention.
Over his career, Shkreli founded four companies and headed five as CEO. Some were hedge funds, and others pharmaceutical companies.
Facing securities fraud charges, Shkreli is no longer working for any of them, but his legacy at the drugmakers remains. Both Turing Pharmaceuticals and Retrophin have left intact the price hikes that drew so much public ire toward Shkreli and the drug industry at large.
Here’s what we know — and don’t know — about the status of former companies once run by Shkreli.
The hedge funds
Shkreli began his career as a hedge fund manager. He founded MSMB Capital Management in his 20s, making the Forbes 30 under 30 list. His fund is described as “best known to investors as an activist who battled billionaires and entrenched drug industry executives through blog posts, shareholder letters, regulatory filings, and even an attempted hostile takeover.”
This also happens to be the company involved in the SEC’s charges against Shkreli. After managing funds at MSMB Capital, where he lost $3 million on bad trades but neglected to tell investors. He then went on to found another hedge fund, called MSMB Healthcare and convinced investors to back it as well.
The securities fraud charges against Shkreli center around his alleged “Ponzi scheme” set-up, in which he used funds raised for one company to bay back debt for the last company.
Incidentally, MSMB was his second fund. At the first, Elea Capital, he lost all the money he managed for investors, according to the charges against him.
After dealing with pharma companies from a hedge fund perspective, Shkreli decided to strike out and found his own such company: Retrophin. Founded in February 2011, the company has had a rocky past with Shkreli, eventually ousting him in October 2014 — but not before he managed to raise the price of a kidney drug called Thiola by 2,000%.
*The price has remained the same despite Shkreli’s departure. Retrophin has two other drugs on the market, and is developing rare disease treatments for kidney and neurological disorders.
But Retrophin now faces a new challenge. Compounding pharmacy Imprimis Pharmaceuticals is working on a $6-per-pill alternative to the now-$30-per-pill Thiola, it said last week, though it remains to be seen if that will have any impact on its market share.
Status: Holding strong, doing some solid development.
Martin Shkreli via Twitter
Martin Shkreli with an Enigma machine, which was famously cracked by Alan Turing.
As Congress saw in a hearing last week, Turing is committed to its pricing strategy when it comes to Daraprim.
Excerpts from documents obtained by Congress indicate that Shkreli expected the move to increase the price of one Daraprim pill from $13.50 to $750 to yield profits for at least three years.”I think it will be huge … Almost all of it is profit and I think we will get 3 years of that or more,” Shkreli wrote in an August message highlighted by the committee. “Should be a very handsome investment for all of us. Let’s all cross our fingers that the estimates are accurate.”
The private company also has a medication to treat hypertension. Turing was founded less than a year ago, and said that it was working on researching and developing new treatments for toxoplasmosis, epilepsy, and others. Most are in preclinical or early stage development. We’ve reached out to Turing for more information on that research.
Status: Standing by the pricing strategy for Daraprim.
The small public pharmaceutical company Shkreli joined in November as CEO was having a hard time before Shkreli stepped in and acquired 70% of the company. The move at the time sent KaloBios’ shares soaring.
After Shkreli became CEO, the company announced that it had bought the US rights to a drug that treats a rare parasitic infection called Chagas Disease. We’ve asked KaloBios about the status of that purchase and will update if we get a response.
When asked about treatments for Chagas Disease, the CDC said, “In the United States, these drugs are not FDA approved and are available only from CDC under investigational protocols at no cost to the patient.”
Since Shkreli’s December arrest, KaloBios has been delisted from the NASDAQ, terminated Shkreli, and filed for Chapter 11 bankruptcy.