States join antitrust suit against ‘pharma bro’ Shkreli
Six state attorneys have joined a suit filed against incarcerated ‘pharma bro’ Martin Shkreli and his company Vyera Pharmaceuticals for allegedly monopolising the market for a life-saving drug.
The US Federal Trade Commission (FTC) and New York’s attorney general originally filed their complaint against Shkreli in late January, claiming that the ‘pharma bro’ and his company had engaged in an anticompetitive scheme to preserve a monopoly for anti-parasite medication Daraprim (pyrimethamine).
At the time, New York attorney general Letitia James said the suit is partly to block Shkreli from “ever working in the pharmaceutical industry again”.
Now, the FTC has filed an amended complaint, adding California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia as co-complainants.
According to the claim, when Vyera (previously known as Turing Pharmaceuticals) acquired the US rights to Daraprim from the only existing supplier in 2015, the drug had been an affordable, life-saving treatment for more than 60 years. After buying the rights, Vyer immediately raised the price from $17.50 to $750 per tablet.
The amended claim added: “To preserve the Daraprim revenue stream, Vyera and Phoenixus—under the direction of Shkreli and Mulleady—executed an elaborate, multi-part scheme to block generic entry.”
Kevin Mulleady, also named as a defendant in the suit, is a former executive of Vyera and chairman of Phoenixus AG’s (Vyera’s parent company) board of directors.
The FTC has alleged that the defendants crafted a “complex web of contractual restrictions that prohibit distributors and purchasers from reselling Daraprim to generic companies or their agents”.
They also kept cut off competitors’ access to pyrimethamine—the active pharmaceutical ingredient (API) necessary to manufacture Daraprim, according to the complaint.
Finally, Shkreli and the other defendants allegedly signed “data blocking” agreements, preventing distributors from selling Daraprim sales data to third-party data reporting companies.
“The purpose and effect of defendants’ anticompetitive conduct has been to thwart potential generic competition and protect the Daraprim revenues resulting from Vyera’s shocking price increase,” added the suit.
Without the anticompetitive conduct, Daraprim would have faced generic competition years ago, said the FTC.
It concluded: “Instead, toxoplasmosis patients who need Daraprim to survive were denied the opportunity to purchase a lower-cost generic version, forcing them and other purchasers to pay tens of millions of dollars a year more for this life-saving medication.”
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