‘Pharma bro’ Martin Shkreli ousted from another drug company

20 Jan 2016 | Author: | No comments yet »

CompaniesShkreli terminated as KaloBios chief executive.

KalosBios Pharmaceuticals was a faltering business until Mr Shkreli was revealed to be an executive and key shareholder last month, when its shares climbed dramatically.KaloBios shares plummeted 53 percent Thursday after Shkreli, 32, was arrested in New York on charges related to one of his previous companies, Retrophin Inc. But in a statement issued on Monday, the company said Mr Shkreli had been “terminated” as CEO and “resigned from his position as a member of the board of directors” at the end of last week.

Mr Shkreli became infamous around the world when it was revealed in September that his then-company Turing Pharmaceuticals had bought the Daraprim drug for treating Aids and cancer, and raised its price from $13.50 to $750 a pill. Last weekend, the University of California at Davis and Moffitt Cancer Center in Florida said they had suspended a planned drug trial sponsored by KaloBios.

Federal prosecutors have now charged Mr Shkreli, 32, with running his former businesses like a Ponzi scheme, using money from new investors to try to repay investors whose money he lost. The former hedge fund manager rose to national prominence after Turing Pharmaceuticals, a privately-held biotech company he ran, increased the price of a drug that treats a rare disorder by 5,000 per cent overnight. A spokesman for Community Solutions said: “We serve people who depend on access to Aids meds every day, and as an organisation I don’t think we can keep this money.” Earlier this month, the Shkreli story took a bizarre twist when it emerged that the businessman was the proud owner of Wu-Tang Clan’s one-of-a-kind “lost” album, Once Upon a Time in Shaolin. The company’s stock was trading at less than $1 before he made the move, and it subsequently rose to as high as $39.50, giving the company a market value of more than $100 million. It was something a watershed moment that sparked criticism not just of Turing, but of other companies in the pharmaceutical industry that have built business models of acquiring drugs and then sharply increasing their prices.

To contact the reporter on this story: Doni Bloomfield in Boston at mbloomfiel12@bloomberg.net To contact the editors responsible for this story: Crayton Harrison at tharrison5@bloomberg.net Cecile Daurat

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