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‘Pharma Bro’ Martin Shkreli ordered to repay $64 million and banned for life from drug industry

Martin Shkreli, who is incarcerated, is seen after appearing before a congressional committee in 2016. (Susan Walsh/AP)

A federal judge on Friday banned the controversial former pharmaceutical executive Martin Shkreli from ever working in that industry again and ordered him to return $64.6 million in wrongfully obtained profits.

Judge Denise Cote of the U.S. District Court for the Southern District of New York ruled on a lawsuit brought by seven states and the Federal Trade Commission against Shkreli, who is serving a seven-year prison sentence for securities fraud. He had increased the price of Daraprim, a lifesaving drug, by 4,000 percent and created a scheme to block competition from generic drugs, the judge found.

“Shkreli has not expressed remorse or any awareness that his actions violated the law,” Cote wrote in her ruling. “While he takes full responsibility … for the increase of Daraprim’s price from $17.50 to $750 per pill, he denies responsibility for virtually anything else.” (Daraprim is an anti-parasitic medication used to treat HIV patients and others with immunocompromised conditions.)

California, Illinois, New York, North Carolina, Ohio, Pennsylvania, and Virginia were the seven states that filed the lawsuit against Shkreli, whose conduct has led to his being dubbed “Pharma Bro” and “the most hated man in America.” He is in federal prison in Pennsylvania and is set for release in November, according to the Federal Bureau of Prisons.

“Envy, greed, lust, and hate … obviously motivated Mr. Shkreli and his partner to illegally jack up the price of a lifesaving drug,” said New York Attorney General Letitia James in a statement. “Martin Shkreli is a Pharma Bro no more.”

Shkreli could not be reached for comment.

Vyera, the company that Shkreli used to acquire the rights to Daraprim, agreed to pay up to $40 million last year to settle a complaint of price gouging brought by the FTC and the seven states. Vyera, which was previously known as Turing, couldn’t be reached for comment, but Shkreli through the years has maintained that the company’s practices were legal and reflected a poor pricing model in the pharmaceutical industry.

Shkreli, a onetime Wall Street insider, is known for acquiring little-known but essential drugs and spiking their prices. After obtaining the rights to Daraprim, he prevented generic drug companies from entering the market by restricting access to the quantity of Daraprim needed to conduct testing required by the Food and Drug Administration. He also worked to limit access to a key ingredient for the drug’s manufacture.

The judge found that his actions violated federal and state laws that ban anticompetitive conduct. “Through these strategies, Shkreli delayed the entry of generic competition for at least eighteen months. Shkreli and his companies profited over $64 million from this scheme,” Cote wrote.

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Shkreli also hiked the price of two other drugs: Chenodal, used to treat a genetic cholesterol disorder, and Thiola, which is used to treat kidney stones. He raised Chenodal’s price from $100,000 to $515,000 per patient per year, and increased Thiola’s price from $4,000 to $80,000 per patient per year. He is not accused of illegal conduct for those price increases.

The sharp increase in the price of Daraprim brought about a congressional investigation. Then-Rep. Elijah E. Cummings, a Maryland Democrat, called Shkreli “the bad boy of pharma,” and his boisterous conduct and regular jabs at journalists made him a minor media personality.

After Shkreli was imprisoned, the U.S. government sold an exclusive Wu-Tang Clan album he owned to an unnamed buyer to help satisfy a multimillion-dollar debt he owed.