Buckling under social media rage — and the glare of politicians who saw him as the perfect poster boy to represent price gouging in the pharmaceutical industry — Turing Pharmaceuticals CEO Martin Shkreli says he will roll back the price of Daraprim, which he had raised from $13.50 to $750 per pill because … well, because he thought he could.
“Yes, it is absolutely a reaction — there were mistakes made with respect to helping people understand why we took this action, I think that it makes sense to lower the price in response to the anger that was felt by people,” Shkreli, 32, told NBC News in a phone interview Tuesday evening, Andrea Mitchell and Phil Helsel report.
Shkreli maintained “that drugs like Daraprim will not exist if small companies cannot get a return on their investment.” He also said, “I think in the society we live in today, it’s easy to want to villainize people, and obviously we’re in an election cycle where this is a very, very tough topic for people and it’s very sensitive. And I understand the outrage.”
Not that Shkreli’s promise of a lower price — he has yet to disclose what it will be — is doing all that much good for his image this morning: “Martin Shkreli Lowers Drug Price, Is Still an Asshole,” reads the hed over Samantha Allen’s piece for the Daily Beast. Allen goes on to detail her repeated attempts to get Shkreli to verify the claims he has made.
Allen wraps it all up by saying “we could have used a similar level of social media passion for any number of cases in which generics received price hikes last year.” She pointed to a Wall Street Journal story by Ed Silverman in October 2014 that revealed that a Congressional investigation found that “half of all generics sold through retailers became more expensive over the past 12 months.”
“In many ways, Shkreli’s social media hubris and his easily debunked data were blessings in disguise,” Allen writes, saying he’d “painted a bulls-eye on his own industry.”
The saga got underway when the New York Times’ Andrew Pollack broke the story on Sunday evening about the price increase for the 62-year-old “orphan” drug, which is used to treat a rare but life-threatening parasitic infection known as toxoplasmosis and was acquired by Turing last month.
Shkreli told Pollack “that the drug is so rarely used that the impact on the health system would be minuscule and that Turing would use the money it earns to develop better treatments for toxoplasmosis, with fewer side effects,” according to his initial report. “This isn’t the greedy drug company trying to gouge patients, it is us trying to stay in business,” Shkreli said.
In reaction to that story, presidential candidate Hillary Clinton “sent drug stocks tumbling Monday with a statement on Twitter promising to unveil a plan to combat high drug prices,” the Wall Street Journal’s Charley Grant recounts. But, he continues, “investors can take comfort in the fact there is a huge distance between a campaign proposal and legislation. Politically driven drug-price scares have ended with a yawn.”
But those yawners were before Shkreli became “the most hated man in America,” if social media be our guide, the BBC says in a round-up of the vitriol. “He's been called a ‘morally bankrupt sociopath,’ a ‘scumbag’ a ‘garbage monster’ and ‘everything that is wrong with capitalism.’ And those are some of the tamer comments.”
Shkreli has a long history of controversy in his relatively short career as a whiz kid, hedge fund manager and entrepreneur, including charges that he harassed a former employee of Retrophin, another pharmaceutical company he founded, and his family on social media. Those charges were settled out of court.
Retrophin later fired Shkreli and filed a federal lawsuit against him around charges that he “improperly passed off legal settlements” with investors in an earlier company he managed, the hedge fund MSMB Capital Management, according to a story last month by Arlene Weintraub on Forbes.com.
Shkreli told Weintraub that Retrophin’s claims were “preposterous” and said “he intends to file his own suits against the company soon.”
In a story in the New York Times this morning, Pollack and Julie Creswell also look at Shkreli’s past from the time the Brooklyn boy “hit Wall St.” as a 17-year-old clerk at the hedge fund Cramer, Berkowitz & Company while he attended Baruch College.
“While in his 20s, he drew negative attention for urging the Food and Drug Administration not to approve drugs made by companies whose stock he was selling short,” they report. One early investor tells them he’s “a sponge for information” but rues that “there’s nobody there in Martin’s life to tell him what the right thing is.”
In response to an email from the Times seeking commenton Tuesday, Shkreli replied: “I think our relationship is over.”
He’s going to find it more difficult than that to break it off.