FTC: Shkreli may have violated a lifetime drug ban, he should be contemptuous

Martin Shkreli, former CEO of Turing Corporation, grinned during a congressional hearing.
Zoom in / Martin Shkreli, former CEO of Turing Corporation, grinned during a congressional hearing.

Martin Shkreli, the notorious former pharmaceutical executive, is in trouble again with the Federal Trade Commission, which is… Announce today that the convicted fraudster had failed to cooperate with the commission’s investigation into whether he violated his lifetime ban from the pharmaceutical industry by setting up a company last year called “Druglike, Inc.”

In a lawsuit today, the FTC asked a New York federal judge to find Shkreli in contempt for failing to turn over required documents to the FTC and for failing to make himself available for an interview. The committee noted that under a 2022 court order that bars him from involvement in the pharmaceutical industry for life, Shkreli is obligated to provide this information to the FTC.

“Martin Shkreli’s failure to comply with the court order demonstrates a clear disregard for the law,” Holly Vedova, director of the Federal Trade Commission’s Office of Competition, said in a press release. “The FTC will not hesitate to deploy the full extent of its powers to enable a thorough investigation of any potential misconduct.”

At issue is whether Shkreli’s co-founding of Druglike conflicts with his company A lifetime ban from the pharmaceutical industrywhich was in response to Shkreli’s infamous move to raise the price of the cheap anti-parasitic drug, Daraprim, from $17.50 a pill to $750 a pill in 2015. In January 2022 court ruling US District Judge Dennis Cott, who banned him from the industry, wrote:

Banning an individual from an entire industry and limiting his future ability to make a living in this field is a serious remedy and should be done with caution and only if justice is required. Shkreli’s egregious, willful, repeated, protracted and ultimately dangerous conduct warrants the imposition of an injunction of this scope.

The injunction bars Shkreli from “participating in the pharmaceutical industry in any capacity”.

However, Shkreli’s new company appears squarely in the pharmaceutical business. in Last year’s press releaseThe company said it would “revolutionize” early-stage drug discovery with a decentralized computing network “enabled by Web3 technology”. Overall, the company’s web-based suite has been touted as allowing drug developers to carry out development tasks of “targeting, designing drugs, and tools to both create and manage virtual screening workflows at scale”.

The press release quoted Shkreli as saying that users “may be held responsible and rewarded for discovering the next new medicine” and that the technology will “disrupt the economics of the pharmaceutical business” and compete with “pharmaceutical giants”.

In its announcement today, the FTC said it initially sought information about the new company and its compliance with its lifetime ban in October, but Shkreli ignored the agency’s “repeated requests.” In addition to requiring the court to prove Shkreli in contempt, the FTC also required that Shkreli be required to comply with the FTC investigation within 21 days of the court’s decision.

The FTC also noted in the court filing that Shkreli has so far failed to pay any of the $64.6 million in no-confidence he was ordered to pay along with a lifetime ban.

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