To use a line from the boy genius himself, lol.
Early this morning in Manhattan, Martin Shkreli was arrested by federal agents for fraud. The now infamous Shkreli has made waves in the news recently for price-gouging a lifesaving AIDS drug. He vaulted the price up an unholy 4000%, and when questioned about it said he regretted not taking it higher. However, the indictment does not pertain to this act of malicious greed, it has to do with the firm he founded Retrophin. Bloomberg is reporting that Shkreli illegally used stock and cash to pay off dubious and unconnected business deals.
A civil suit was filed in August by Retrophin against Shkreli. The 32-year old founded the company but was ousted from the company by the board and subsequently sued. They accuse Shkreli of using the company account as petty cash to pay off disgruntled former investors of Shkreli’s disbanded hedge fund, MSMB Capital Management. Shkreli had this to say about the lawsuit: “The $65 million Retrophin wants from me would not dent me. I feel great. I’m licking my chops over the suits I’m going to file against them.” MSMB investors had a good reason to come after Shkreli, a blown deal with Merrill Lynch in 2011 lost $7 million and promptly left the company financially destitute. Shkreli claims these payoffs and maneuvers to former investors were done under the approved counsel of the acting board, but clearly they don’t agree.
Shkreli absconded creating Turing Pharmaceuticals and has been on a publicity fueled ride where he has been dubbed by the BBC, “the most hated man in America.” Shkreli recently bought a majority stake in KaloBios (KBIO) and acquired a license for benznidazole, a standard treatment for Chagas, a deadly parasitic infection most common in South and Central America. He has been plotting a price increase similar to Hepatitis C drugs that can escalate to $100k.
The arrest of Shkreli has KBIO down 55% in pre-market trading and was halted altogether by the exchange. Investors have had a wild ride since Shkreli announced he bought a majority stake in KaloBios trading from $2 to $45 and back down to $11 in twenty trading days.
My advice is stay away from the most hated man in America.
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