MANHATTAN (CN) — The company that infamously marked up a lifesaving HIV drug 4,000% will pay a $40 million penalty, New York Attorney General Letitia James announced Tuesday.
Back when it was founded in 2015 by the now-imprisoned business wunderkind Martin Shkreli, Vyera Pharmaceuticals, then known as Turing, bought the rights to the drug Daraprim and jacked up its price overnight from $17.50 to $750 per pill.
At the time, the product was the only FDA-approved medication to treat the parasitic disease toxoplasmosis, a foodborne illness that can be deadly and is particularly dangerous to pregnant people and those with weakened immune systems.
Daraprim was previously inexpensive and accessible, and James says Vyera executives then began working to impede competition to keep selling the drug at its soaring price.
Shkreli, 38, resigned as Turing CEO after his arrest in 2015. He will go to trial over the lawsuit in the Southern District of New York, set to begin on December 14, charges that carry the potential for a lifetime ban from the pharmaceutical industry. For unrelated charges, he is already serving a seven-year prison sentence after being convicted in 2017 of securities fraud in the Eastern District of New York.
At the upcoming civil trial, “we will lay out Mr. Shkreli’s greedy, dangerous, and anticompetitive behavior,” James said in a statement Tuesday.
In addition to the financial penalty, the settlement with Vyera bans another former CEO Kevin Mulleady from the pharmaceutical industry for seven years, a measure that James’ office said was a first for a New York antitrust case.
Large portions of the complaint are redacted, but Vyera's monopolistic conduct is said to have delayed generic drug competitors by cutting off access to the active ingredient in the drug and hiding data about Daraprim sales.
“Vyera and Mulleady, along with Martin Shkreli, shamelessly engaged in illegal conduct that allowed them to maintain their exorbitant and monopolistic price of a life-saving drug — letting pharma bros get rich, while others paid the price,” James said.
It was Shkreli's shamelessness that gained him notoriety, particularly after a he smirked throughout a congressional hearing in 2016, invoking his Fifth Amendment right not to answer any questions posed by the House Oversight and Government Reform Committee.
On social media, he had more to say: "Hard to accept that these imbeciles represent the people in our government," Shkreli tweeted at the time.
James filed the January 2020 lawsuit in the Southern District of New York, along with the Federal Trade Commission. It names Shkreli, Mulleady, Vyera — formerly known as Turing — and its parent company Phoenixus.
California, Illinois, North Carolina, Ohio, Pennsylvania and Virginia joined the lawsuit shortly after it was filed.
The U.S. Food and Drug Administration approved a generic version of Daraprim, called pyrimethamine, in March of 2020.
Despite criminal and civil legal actions, the brand name drug still cost $750 per pill in September 2020, Roll Call reported at the time. The generic pills went for $183 each — still 13 times higher than Daraprim’s original price.
Representatives for Vyera did not return a request for comment.
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