UNTIL a few days ago few people had heard of Martin Shkreli, a 32-year-old former hedge fund investor from New York.
Now he has found himself catapulted into global notoriety after the pharma-ceutical company Turing, where he is chief executive, this week increased the price of the life-saving drug Daraprim by a whopping 5,000 per cent.
Last month the company bought the rights to the drug, which is used mainly to treat toxoplasmosis, a parasitic infection that affects people with compromised immune systems, including AIDS and HIV patients, as well as cancer sufferers.
Some patients take between five and 10 tablets every day, meaning this price hike – which only affects patients in the US – may condemn thousands of Americans either to bankruptcy or a shorter life expectancy
And yet it costs less than 75p to make each Daraprim pill, which was first approved by the US Food and Drug Administration (FDA) in the 1950s.
Speaking on Bloomberg News earlier this week Shkreli attempted to defend himself saying that the paltry production costs don’t include the price of marketing and distribution.
He said: “If there was a company that was selling an Aston Martin at the price of a bicycle and we bought that company and charged Toyota prices I don’t think that should be a crime. We’re simply charging the right price. We have to turn a profit.”
Shkreli added that these profits will be used to make improvements to the 62-year-old drug recipe and that it is “still underpriced relative to its peers”.
His explanation is unlikely to satisfy his critics. They have labeled him a “morally bankrupt sociopath”, a “scumbag” and “everything that is wrong with money, medicine and politics in America”. Hillary Clinton this week joined the chorus, declaring: “Price gouging like this in the specialty drug market is outrageous. Tomorrow I’ll lay out a plan to take it on.”
Yet Shkreli’s response to his online critics was to tweet defiant lyrics from a song by rapper Eminem. (“And it seems like the media immediately points a finger at me/ So I point one back at ’em, but not the index or pinkie.”)
Judith Aberg, a spokeswoman for the HIV Medicine Association, said that even patients with insurance to cover some of the inflated cost of Daraprim could end up more than £100 per pill out of pocket now that the price has gone up from £8.78 to a staggering £488.26 per pill. ($750 in U.S. currency).
This month Aberg joined forces with the Infectious Diseases Society of America to pen an open letter to Shkreli. In it they said that the proposed massive price increase on Daraprim was “unjustifiable for the medically vulnerable patient population” and was “unsustainable for the healthcare system”.
Shkreli has long courted controversy. The son of Albanian and Croatian immigrants he grew up in a working-class community in Brooklyn, New York and subsequently gained a business degree in 2004.
Aged 17 he began an internship at a hedge fund founded by American TV personality and best-selling author Jim Cramer and two years later he launched his own such fund. But it closed a year later after a £1.5million lawsuit from Lehman Brothers which collapsed before a verdict was reached.
We have to turn a profit
Undeterred Shkreli then set up MSMB Capital Management in 2008. It funded his first foray into the pharmaceutical industry in 2011 when he founded a biotech firm called Retrophin, which focused on producing medicines for rare diseases.
Yesterday it also emerged that Shkreli is a repeat offender when it comes to inflating the price of drugs. In May 2014 Retrophin acquired the rights to sell a drug named Thiola which is used to treat a rare and incurable kidney condition known as cystinuria. Many sufferers have to take the drug from early childhood.
Shkreli’s company promptly increased the price of Thiola from £1 per pill to more than £20 a pill.
In September 2014 Shkreli was ousted as head of the company amid allegations of misuse of company money and is now being sued by Retrophin for £43million. He denied the accusations, claiming: “They are sort of concocting this wild and crazy and unlikely story to swindle me out of the money.”
His integrity may be shrouded in doubt but Shkreli’s ego and ambition remain intact and in February this year he launched his present company Turing.
In the past 48 hours he has sought to address the Daraprim debacle, claiming that he will now lower the price of the drug to make it more affordable. But he has not revealed exactly what the new cost to patients will be.
Whatever the adjustment to the figures it has been called an empty gesture that has come too late. There was an insight on Shkreli’s now-deleted profile on a dating website called OK Cupid in which he described himself as “intelligent, handsome and all sorts of other good qualities”.
“I am endlessly entertaining, providing comedic relief and artistic thought in one convenient package. What a catch!” He also revealed he spends a lot of time thinking about “human suffering”.
The suffering of those families with a loved one who is reliant on Daraprim doesn’t seem to have occurred to him, however, nor the huge financial investment that they now face in order to maintain their health.
