December 17, 2015
1 min read

Turing CEO indicted on securities fraud charges

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Federal prosecutors indicted Turing Pharmaceuticals CEO Martin Shkreli today on charges of securities fraud, securities fraud conspiracy and wire fraud conspiracy involving his former hedge funds and pharmaceutical company, according to a statement from the Department of Justice.

“As alleged, Martin Shkreli engaged in multiple schemes to ensnare investors through a web of lies and deceit,” Robert L. Capers, JD, United States attorney for the Eastern District of New York, said in the press statement. “His plots were matched only by efforts to conceal the fraud, which led him to operate his companies, including a publicly traded company, as a Ponzi scheme where he used the assets of the new entity to pay off debts from the old entity.”

Public focus shifted to Turing and Shkreli after the price of Daraprim (pyrimethamine) jumped from $13.50 per tablet to $750 per tablet, according to the Infectious Diseases Society of America and the HIV Medicine Association (HIVMA). Shkreli became a public figure when voicing his commitment against repricing the treatment, which company officials recently announced would be discounted up to 50% for hospitals treating patients with toxoplasmosis.

The current seven-count indictment relates to three interrelated schemes associated with the hedge funds MSMB Capital Management and MSMB Healthcare Management, as well as the publicly traded pharmaceutical company Retrophin, all of which were founded by Shkreli. Evan Greebel, JD, also was charged with wire fraud conspiracy for working with Shkreli to misappropriate Retrophin assets.

“The charges announced today describe a securities fraud trifecta of lies, deceit and greed,” Diego Rodriguez, assistant director-in-charge of the FBI’s New York field office, said in the statement. “In the end, Shkreli and Greebel used a series of settlement and sham consulting agreements that resulted in Retrophin and its investors suffering a loss in excess of $11 million. While the charges announced today are significant, they are but one example of what’s left to come as the FBI continues this investigation.”