'Pharma Bro' firm reaches $40 million settlement in gouging case while Martin Shkreli is on trial

Toisthe News - 'Pharma Bro' firm reaches a $40 million settlement in the gouging case while Shkreli is on trial.

After securing exclusive rights to a life-saving treatment, a business once run by "Pharma Bro" Martin Shkreli will pay up to $40 million to resolve charges that jacked up the price by almost 4,000 percent.

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Pharma Bro' firm reaches a $40 million settlement in gouging case while Martin Shkreli is on trial. Martin Shkreli will pay up to $40 million to resolve issues.

Martin Shkreli, renowned for drug price-gouging and a sardonic online persona, is still facing an antitrust trial for his alleged role in orchestrating a price-gouging scheme for the life-saving drug Daraprim.

Martin Shkreli's former pharma corporation, "Pharma Bro," and its parent company have agreed to pay up to $40 million to settle a lawsuit alleging that they "fleeced patients" by raising the price of a life-saving medication by more than 4,000 percent.

Shkreli, who is best known for drug price gouging and a sardonic online persona, rose to international prominence as a result of the charges against him and is presently serving a prison sentence for security fraud.

The Federal Trade Commission and state co-plaintiffs, including New York, California, and Illinois, said in a statement that they had filed an order in court that "shuts down the criminal plan" masterminded by Shkreli to exploit patients "dependent on the life-saving medicine Daraprim." 

Source: AP- Pharmaceutical CEO Martin Shkreli talks before the House Committee on Oversight and Reform on Feb. 4, 2016, in Washington, D.C., about his former company's decision to hike the price of a life-saving prescription. Shkreli's former business, Vyera Pharmaceuticals, will pay up to $40 million to settle claims that it raised the price of a life-saving treatment by nearly 4,000% after securing exclusive rights to the drug. The settlement was announced by the Federal Trade Commission on Tuesday, December 7, 2021.

Shkreli is presently serving time in jail for security fraud. He is most known for drug price gouging and a caustic internet persona.

Vyera Pharmaceuticals LLC and its parent company, Phoenixus AG, agreed to settle allegations that they overcharged customers and monopolized sales of Daraprim, which is used to treat toxoplasmosis, an infection that can be fatal for people with HIV or other immune system problems and can cause serious problems for children born to women who were infected while pregnant, according to the FTC.

After acquiring exclusive rights to the decades-old medicine in 2015, Vyera hiked the price from $17.50 to $750 per pill.

In an email to a contact at the time, Shkreli stated, "Should be a very nice investment for all of us." The hike resulted in co-pays as high as $16,000 for some patients, sparking outrage and congressional hearings.

Vyera and Phoenixus AG will be required to pay up to $40 million in compensation to victims under Tuesday's judgment, while Mulleady will be barred from working for any pharmaceutical business for the next seven years.

Meanwhile, Shkreli, Vyera's founding CEO, is slated to commence an antitrust trial on December 14 in response to the charges.

"This settlement settles all claims brought by the FTC and the state co-plaintiffs, as well as those brought in a related class action complaint, with the exception of Shkreli," the FTC said.

FTC Chair Lina Khan stated in a separate statement that the settlement "puts money back in the pockets of drug patients who were fleeced by a monopolistic enterprise."

The FTC and seven states sued the corporation in federal court in New York: New York, California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia.

Vyera allegedly raised the price of Daraprim and illegally imposed "a web of anticompetitive restrictions" to prevent other companies from developing cheaper generic versions by denying them access to a key ingredient for the drug and data they would need to assess the drug's market potential, according to the lawsuit.

Vyera did not immediately respond to an after-hours email requesting a comment. However, after the case was filed last year, the corporation dismissed the allegations as unfounded and disputed that its actions prevented potential competitors from entering the market.

Vyera and Phoenixus must pay up to $40 million in relief to consumers who were allegedly fleeced by their conduct over the next ten years, and they must make Daraprim available to any possible generic competitor at the cost of production, according to the settlement filed Tuesday.

According to an FTC statement, former Vyera CEO Kevin Mulleady agreed to pay $250,000 if he violates the settlement, which prohibits him from "working for, consulting for, or controlling a pharmaceutical firm" for seven years.

The settlement does not exclude further litigation against Shkreli, who was dubbed the "Pharma Bro" who was Vyera's original CEO and allegedly masterminded the plan. The FTC and the states have filed a complaint against him, and it will go to trial next week.

Shkreli is currently serving a seven-year sentence for securities fraud connected to hedge funds he managed before entering the medicines industry.