Martin Shkreli, the former pharmaceutical executive known for jacking up the price of a life-saving drug, may face additional federal charges, including securities fraud.
Prosecutors could file more charges related to Shkreli’s involvement with biopharmaceutical company Retrophin Inc. within a month, Assistant U.S. Attorney Winston Paes said at a Tuesday hearing in federal court in Brooklyn, New York, Reuters reported.
Paes said the securities fraud charges would be similar to the existing charges. Prosecutors have previously accused Shkreli of wire fraud, including illegally siphoning money from one of his companies to pay off bad market bets made by another of his companies.
Shkreli, who turned 33 in April, began his career as a hedge fund manager. He founded Retrophin (NASDAQ:RTRX) in 2011 and ran it as a biotech portfolio company that acquired the rights to obsolete drugs, which he said he planned to “repurpose.”
But Shkreli resigned in October 2014 after Retrophin’s board decided to replace him as CEO. The company then filed a $65 million lawsuit against him, claiming he “committed stock-trading irregularities and other violations of securities rules.”
Shkreli next launched a new pharmaceutical company, called Turing Pharmaceuticals, in 2015. As the CEO, his business plan included buying licenses for out-of-patent drugs and re-evaluating their prices. Turing was reviled under Shkreli’s leadership last summer for jacking up the price of Daraprim, which is used to treat a life-threatening parasitic infection in HIV patients. Turing raised the price from $13.50 per pill to $750 a pop — a more than 5,000 percent jump.
In December, Shkreli was arrested by the FBI for committing a “trifecta of lies, deceit and greed,” although those accusations are not related to the price increase for Daraprim. He was accused of using MSMB Capital Management, the hedge fund he created in 2009, and Retrophin “like a personal piggy bank,” U.S. Attorney Robert Capers said after announcing the seven-count indictment.
After Tuesday’s hearing, Shkreli is next scheduled to appear in federal court on June 6. His attorneys said they have been inundated with 70 gigabytes of documents, which is slowing their efforts to process the case quickly, CNBC reported.