Martin Shkreli pushes back on lifetime public company ban from prison cell in bid to get back to business
Despite serving his stint behind bars, the Martin Shkreli saga continues to sprout legs with new lawsuits popping up. Now, in anticipation of being a free man once again, Shkreli is pushing back on a federal ban that would seek to keep him out of a public company’s boardroom for the rest of his life.
Shkreli’s lawyers hope to rescind the former Retrophin CEO’s lifetime ban from the SEC on serving as a director or officer of a publicly traded company, arguing that other disgraced executives have received much more lenient 10-year bans, according to a brief filed in a NY courtroom.
The lawyers pointed to Shkreli’s status as a first-time offender to make the case he likely wouldn’t repeat the white-collar misconduct that placed him in prison and argued that his age — 38 — means a lifetime ban “would have a far greater punitive impact on him than on a similarly situated, but older, defendant.”
In arguing his case, Shkreli’s team pointed the example of former Theranos head Elizabeth Holmes, who earned a 10-year ban from the SEC despite facing fraud charges in federal court. Holmes, lawyers argued, engaged in crimes “a hundred times the size of the fraud” Shkreli committed and earned a more lenient ban. Another case they pointed to was Schultz Chan, a former Akebia biostatistics director who committed insider trading and was only shut out of serving at a public company for five years.
Shkreli’s team also argued that he shouldn’t be on the hook for a $1.4 million fine from the SEC given his ongoing sentence and the millions he’s already lost in civil fine and forfeitures.
The idea of Shkreli, the “pharma bro” who defrauded Retrophin’s investors, getting back to business should be enough to make the biotech industry’s blood run cold. But even in the middle of his prison sentence, Shkreli’s problems are only starting.
In March, Blue Cross Blue Shield of Minnesota sued Shkreli and Vyera Pharmaceuticals — formerly Turing — over plans to utilize what are known as “resale restrictions,” preventing producers of potential Daraprim generics from obtaining the necessary samples of the drug needed for FDA evaluation. Daraprim, you’ll remember, was the toxoplasmosis drug for which Shkreli jacked up the price and sparked national outrage.
Shkreli, Vyera and the other defendants named — the Swiss biotech Phoenixus and its CEO Kevin Mulleady — also allegedly tried to buy up all the supply of Daraprim’s active ingredient pyrimethamine, and refused access to the Daraprim sales data needed to determine whether a generic product would be commercially viable.