Campaign for Accountability Calls on Congress to Investigate Biotech CEO Martin Shkreli

Photo: Paul Taggart, Bloomberg

FOR IMMEDIATE RELEASE: October 1, 2015

Contact: Anne Weismann, 202-780-5750

Dan Stevens, dstevens@campaignforaccountability.org

WASHINGTON D.C. – Today, Campaign for Accountability (CfA) called on two congressional committees to investigate Martin Shkreli, the CEO of Turing Pharmaceuticals, for manipulating the Food and Drug Administration’s (FDA) regulatory process for his personal financial gain.  CfA’s Executive Director, Anne Weismann, sent a letter to the House Energy and Commerce Committee and the Senate Commerce, Science and Transportation Committee requesting an immediate investigation of Mr. Shkreli in light of his recent decision to raise the price of Pyrimethamine, a drug used to fight toxoplasmosis, by 500 percent.

Click here to read CfA’s letter to Congress

Ms. Weismann stated, “while touting himself as a medical expert capable of evaluating the efficacy of drugs, in reality Mr. Shkreli is a charlatan willing to use any tactic to line his pockets – including price gouging – regardless of the impact on global health and welfare.”

Mr. Shrkeli previously waged several campaigns to manipulate the market price of biotechnology and pharmaceutical industry stocks, using the FDA’s drug approval process to urge the agency to deny approval of certain new drugs.  A denial by the FDA would have financially benefitted Mr. Shkreli, as he was shorting stock in the companies that manufactured the drugs under consideration.

Earlier this year, as the interim Executive Director of Citizens for Responsibility and Ethics in Washington, Ms. Weismann called on Congress to investigate Mr. Shkreli, and two other noted short-sellers, for attempting to influence the federal regulatory process.  Given Mr. Shkreli’s recent actions as the CEO Turing Pharmaceuticals, Weismann said such an investigation is long overdue.

The text of the letter is embedded below.

CfA is new nonprofit watchdog organization that uses research, litigation, and aggressive communications to expose misconduct and malfeasance in public life and hold those who act at the expense of the public good accountable for their actions.

Dear Chairmen Thune and Upton and Ranking Members Nelson and Pallone:

Campaign for Accountability (“CfA”) urges the Senate Committee on Commerce, Science and Transportation and the House Committee on Energy and Commerce to immediately investigate Martin Shkreli, now infamous for price gouging, but less well-known for his efforts to manipulate the FDA for his personal financial gain.

On March 18, 2015, on behalf of Citizens for Responsibility and Ethics in Washington (“CREW”), where I was then interim executive director, I requested that your committees investigate three short sellers – one of whom was Martin Shkreli – for manipulating the government regulatory processes for personal financial gain.  I explained that in July 2012, CREW had asked the SEC to investigate Mr. Shkreli, then chief investment officer of the hedge fund MSMB Capital Management, for manipulating the market price of biotechnology and pharmaceutical industry stocks.  While it had been reported that Mr. Shkreli was under investigation for possible security law violations, so far Mr. Shkreli appears to have evaded any consequences for his deplorable conduct.

Today, three years after first alerting the government to Mr. Shkreli’s unethical and potentially criminal course of conduct, I am again writing, now as executive director for Campaign for Accountability, to update you on Mr. Shkreli’s most recent actions, which reveal the lengths to which he goes to line his pockets at public expense, and to urge congressional action.

Mr. Shkreli is now the Chief Executive Officer of Turing Pharmaceuticals, a small pharmaceutical company that acquired the drug pyrimethamine in mid-August 2015.  This drug, sold under the brand name Daraprim, is used to fight toxoplasmosis, a parasitic infection the Centers for Disease Control and Prevention has identified as one of its priorities for public health action based on the number of people infected, its severity, and its susceptibility to prevention and treatment.  Toxoplasmosis is considered to be a leading cause of death attributed to foodborne illness in the United States, and  pyrimethamine is on the World Health Organization’s List of Essential Medicines.

Upon purchasing pyrimethamine, Turing increased the price of a single tablet from $13.50 to $750, representing a 5000 percent increase, making the drug inaccessible for “the most medically vulnerable patient population.”  Mr. Shkreli has publicly defended his massive price hike of pyrimethamine by claiming it will have only a very limited impact because the drug is rarely used, and suggesting the price is now more consistent with the prices of other drugs used to treat rare diseases.  This argument has been met with justifiable outrage by the medical community and patient advocates, especially those acting on behalf of individuals infected with HIV.  Reportedly, Turing has now announced it will cut the price of pyrimethamine, but has not yet identified what the new price will be.

Unfortunately, Mr. Shkreli’s conduct at Turing is consistent with his history of pursuing profits at the expense of public health.  While touting himself as a medical expert capable of evaluating the efficacy of drugs, in reality he is a charlatan willing to use any tactic to line his pockets – including price gouging – regardless of the impact on global health and welfare.

For these additional reasons, I respectfully urge you to investigate the conduct of Mr. Shkreli and consider how to deter investors like him from abusing government processes.

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