Must Read: Rags To Riches To Hated, Bitches: The Martin Shkreli Story

“the most hated man in America” Is a tagline you may have recently heard dubbed on a man named Martin Shkreli. This title is due to the CEO’s recent price hike of an antiparasitic pharma drug (used for patients containing the HIV virus, and pregnant women) by over 5600%. The price hike was part of a business strategy to acquire out-of-patent medicines for windfall profits*. But That isn’t close to the good bones of the Shkreli story, that’s only the reason Mr. Shkreli came into the spotlight recently.

Shkreli

Martin Skhreli was born to Albanian and Croatian immigrants who both worked as janitors, in Sheepshead bay Brooklyn, 1983. Skip the childhood and cut to senior year of high school where a young Shkreli dropped out because of lack of interest, but was able to pursue sufficient credits to graduate through an internship on wall street (Cramer Berkowitz). Shkreli garnered recognition from the company’s higher ups after a good call shorting a biotech company(Shkreli was directly questioned by the feds about his trade, first sign*). It was at this juncture that Skhreli presumably got his eye on the market and the dollar, as he used the pharma industry as his chess board.Shkreli Chess

A 2005 graduation date from Baruch College in New York City and ample experience in the financial field led him to short term jobs as an analyst with Intrepid Capital, and UBS management. It was one short year later in 2006 that Shkreli started his first hedge fund, Elea Capital management. The second sign* of foul play can be seen early as Lehman Brothers won a 2.3 million dollar default judgment against the fund, but luckily Lehman Brothers collapsed before it could crystalize the money.

2009 Shkreli launches MSMB Capital Management, which became known for shorting companies, and proceeding to incessantly expose flaws in the said companies among internet stock trading chatrooms, thus driving  possible investors and journalists away from the stock. From 2009-2011 Shkreli continues trading pharma stocks through MSMB. It is around this time he also begins absorbing companies with new groups. For a time period he is the CEO of two pharma companies. Shortly after Shkreli founded the company Retrophin, he is removed as CEO by the board of the company, and sued for 65 million dollars for improper use of funds, third sign*.Shkreli hoodie arrested

February 2015, the name we’ve all been waiting for, Turing Pharmaceuticals, is founded by Martin Skhreli. He sets a business model to obtain out-of-patent medicines, and essentially corner the market on the product, making Turing the only game in town, and thus having price manipulation options. Here is where the ever so famous price hike comes into play. Turing acquired Daraprim (an FDA approved therapeutic since 1953) for 55 Million dollars. A deal was brokered to acquire the drug and it’s distribution rights, hence acquiring an entire market without competitors. The price of the drug, which is used in HIV positive patients, and anyone with compromised immune systems really, went from $13.50 U.S, to $750.00 U.S overnight. Now remember the majority of this price is paid by insurance agencies, but there is always a trickle down effect. Once this news broke the media took hold and do-gooders everywhere decided to chime in, including the majority of presidential candidates on both sides. A terrific..

..quote given by Shkreli on the topic, breaking the accusations into lesser mumbo jumbo, “If there was a company that was selling an Aston Martin at the price of a bicycle, and we buy that company and we ask to charge Toyota prices, I don’t think that that should be a crime”. Hilariously..

a few days after this statement Shkreli publicly announced he would be lowering the price of the drug, and a short while after that, the company announced the price drop would not be happening. Was Martin Shkreli Trolling the media? Perhaps. The company has since agreed to actually lower the price of the drug.

December 17th, Shkreli receives an Indictment letter from the United Stated Government on securities fraud charges. To avoid legal jargon, he is being sued for a ponzi like scheme paying off investors of his hedgefund with money from the company he founded, Retrophin. He is currently still in the legal process. In mid February Skhreli acquired a new top dollar lawyer, who’s conditons to start working were that Shkreli keep his mouth shut on all media outlets. Martin Shkreli is in the midst of legal battles at the moment.

You decide what’s fair and what isn’t, was this business or robbery?

Feel free to leave your thoughts at the bottom, as always, be tactful and think it through.

Stay Wise,

S.

Fun facts about Martin Shkreli:

  • 2014 League of legends player “Imagine Cerebral”, he is the owner of the team Odyssey E Sports. Aimed to qualify for the 2015 League of Legends Qualifier, but failed.
  • November 2015 wins auction for the only copy of the Wu-Tang Clan Album Once Upon A Time In Shaolin. Bloomberg BusinessWeek reveals Shkreli as the purchaser in December of 2015. He has made many threats to break the CD, or simply never let anyone else hear it. My personal thought is that Wu Tang thought whoever won it would sell the copying rights, go figure.
  • Shkreli Offered Kanye West 15 Million dollars for his new album “The Life of Pablo”, the offer was declined.
  • **Windfall Profits are basically insane profits brought about by specific circumstances, whether they be man made or timely, like a price spike or supply shortage. Windfall Profits are also a legal term used in a different branch of taxation.

 

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