Turing CEO posts $5M bond, resigns

23 Dec 2015 | Author: | No comments yet »

‘I am confident I will prevail’: Disgraced pharmacy boss Martin Shkreli claims fraud allegations against him are ‘baseless and without merit’.

Disgraced pharma magnate Martin Shkreli defaulted to his defense-by-Twitter ways on Saturday to label allegations of fraud lobbed against him as “baseless and without merit.” Shkreli, 32, was arrested Thursday by the FBI on seven counts related to “widespread” securities fraud through a hedge fund and drug company he once ran.The University of California at Davis and Moffitt Cancer Center in Florida have suspended a planned drug trial sponsored by KaloBios Pharmaceuticals Inc. following the arrest of Chief Executive Officer Martin Shkreli on securities fraud charges. Shkreli was charged on Thursday with securities fraud, securities fraud conspiracy and wire fraud conspiracy related to his management of hedge fund MSMB Capital Management and biopharmaceutical company Retrophin Inc. Moffitt has suspended the clinical trial, which was to have been funded by KaloBios, indefinitely “pending the outcome of the investigation of KaloBios’ CEO,” the center’s spokeswoman Patricia Kim said Saturday in an e-mail.

Shkreli, who has become a lightning rod for growing outrage over soaring prescription drug prices, was arrested before dawn at the tony Murray Hill Tower Apartments in midtown Manhattan. He then bought the Wu-Tang Clan’s one-of-a-kind secret album encased in a hand-crafted bejewelled silver box, out-bidding billionaires across the globe. To do so, he says, he felt it necessary to dramatically increase the price of Daraprim, which is on the World Health Organization’s list of essential medicines.

His tweet on Saturday was his first direct comment about the pending charges, although a representative earlier said Shkreli was confident that he would be cleared. It was a dramatic turn of events for Shkreli, who in recent months became a pariah for his controversial remarks in the press and taunts on social media outlets, including to Democratic presidential candidate Bernie Sanders. Shkreli has also used his Twitter account to thank his supporters and post articles about himself since he posted a $5 million bond Thursday and resigned from his CEO post at drugmaker Turing Pharmaceuticals.

Hillary Clinton, the front-runner for the Democratic presidential nomination, pilloried him for price-gouging, and he was pulled into congressional investigations into drug pricing. On Friday, he live-streamed more than three hours of his mundane evening in his New York apartment, where he spent chatting with some of the hundreds of curious people who tuned in. In an odd foreshadowing of events, a video posted last night on his YouTube page shows Shkreli answering a phone call during a live stream in which a caller at 1:22:10 identifies himself as a “special agent” before Shkreli appears to cut him off and hangs up. 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.

Brooklyn US Attorney Robert Capers said at a news conference that Shkreli “essentially ran his companies like a Ponzi scheme, where he used each subsequent company to pay off defrauded investors in the prior company.” Authorities highlighted what they called the “brazenness” of his actions. That sat above a retweet he had posted of a Vanity Fair profile from a day earlier, and a link to a Dec. 17 statement that also said Shkreli expected to be “fully vindicated.” Several other institutions were scheduled to participate in the trial. The indictment, the result of an ongoing investigation, also charged Evan Greebel, a former partner at law firm Katten Muchin Rosenman who was Retrophin’s outside counsel. Weill Cornell Medical College and Northwestern University’s Lurie Comprehensive Cancer Center had no immediate comment or didn’t return a call seeking comment.

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