Following a tear-filled appearance in court last Friday, notorious ex-pharmaceutical head Martin Shkreli was sentenced to seven years in prison for securities fraud. The former CEO and founder of Turing Pharmaceuticals had faced charges for defrauding investors in his hedge funds, MSMB Capital and MSMB Healthcare, in a scheme involving Retrophin Inc, a drug company that Shkreli founded. At his sentencing hearing, U.S. District Court Judge Kiyo Matsumoto imposed the seven-year sentence on Shkreli, in addition to a $75,000 fine and three years of probation following his release.
The sentencing comes six months after a trial jury convicted Shkreli on two counts of securities fraud and one count of conspiracy to commit securities fraud, and two years after his initial arrest. The FBI had arrested Shkreli at his Manhattan apartment in December 2015 on charges of "widespread fraudulent conduct." A former hedge fund manager, Shkreli entered the world of pharmaceuticals in 2011, when he founded the biotechnology firm Retrophin. In August 2017, Shkreli had been found guilty of lying to investors regarding key information about the funds that he managed. Prosecutors estimated that damage to investors in losses totaled between $9 million and $20 million.
Appearing before Judge Matsumoto earlier on Friday, Shkreli had cried as he apologized to the investors whose money he had stolen. The infamous "Pharma Bro" suddenly appeared penitent, saying "I am here because of my gross, stupid and negligent mistakes I made." In his statement, Shkreli also claimed that he was "never motivated by money," and that he was interested instead in "[growing his] stature and [his] reputation."
Shkreli's attorneys had asked for a maximum sentence of 18 months, while the prosecuting U.S. Attorneys had sought a sentence of 15 years for the disgraced entrepreneur. Had Shkreli been penalized in strict accordance with sentencing guidelines, he would have faced a maximum of 20 years in prison. Judge Matsumoto had earlier ordered Shkreli to forfeit $7.36 million of his assets, an amount that includes the former businessman's $5 million bond as well as the only copy of the Wu-Tang Clan album Once Upon a Time in Shaolin in the world, purchased by Shkreli for $2 million at a 2015 auction.
Shkreli only began earning widespread notoriety in September 2015, after Turing Pharmaceuticals acquired the manufacturing license to Daraprim, an anti-parasitic drug that fights toxoplasmosis. Under Shkreli's lead, the company immediately raised Daraprim's price from $13.50 a tablet to $750, an increase of more than 5,000%. Turing's egregious price hike of a drug largely used to treat newborns and HIV patients prompted widespread criticism of the company and of Shkreli. The Turing CEO's smug and defiant defense of the company's actions in the face of near-universal public outcry quickly made him "the most hated man in America."
- https://www.wsj.com/articles/martin-shkreli-arrested-on-fraud-charges-1450359637
- https://www.washingtonpost.com/news/business/wp/2018/03/09/martin-shkreli-to-be-sentenced-friday-faces-more-than-decade-in-prison/?utm_term=.d260d3e566f5
- https://www.theguardian.com/us-news/2015/dec/17/martin-shkreli-arrested-by-fbi-over-hedge-fund-investigation
- https://www.nbcnews.com/news/us-news/pharma-bro-martin-shkreli-sentenced-seven-years-defrauding-investors-n854241
- https://www.cnbc.com/2018/03/09/pharma-bro-martin-shkreli-sentenced-to-7-years-in-prison.html