The Fed­er­al Trade Com­mis­sion and sev­en states on Tues­day an­nounced a new or­der un­der which the states will re­coup $40 mil­lion from phar­ma bad­boy Mar­tin Shkre­li, who’s cur­rent­ly in prison for se­cu­ri­ties fraud, and who spiked the price of an old, cheap tox­o­plas­mo­sis drug Dara­prim by 4,000% overnight.

The or­der fol­lows a Jan­u­ary 2020 com­plaint against Shkre­li, his as­so­ciate Kevin Mul­leady, who’s banned from work­ing in for phar­ma for 7 years, their com­pa­ny Vy­era Phar­ma­ceu­ti­cals and its par­ent com­pa­ny Phoenixus AG. The com­plaint al­leged that Shkre­li and Mul­leady not on­ly hiked the price of Dara­prim but used re­stric­tive dis­tri­b­u­tion and sup­ply agree­ments, as well as da­ta se­cre­cy, to il­le­gal­ly block cheap­er gener­ic ver­sions of the drug.

“To­day’s ac­tion puts mon­ey back in the pock­ets of drug pa­tients fleeced by a mo­nop­o­lis­tic scheme,” FTC chair Lina Khan said in a state­ment. “While lit­i­ga­tion against Shkre­li con­tin­ues, the or­der shuts down the il­le­gal en­ter­prise run by his com­pa­nies, Vy­era and Phoenixus, and bans his as­so­ciate from the in­dus­try. This strong re­lief sets a new stan­dard and puts cor­po­rate lead­ers on no­tice that they will face se­vere con­se­quences for rip­ping off the pub­lic by wan­ton­ly mo­nop­o­liz­ing mar­kets.”

Vy­era and Phoenixus are now re­quired to make Dara­prim avail­able to any po­ten­tial gener­ic com­peti­tor at list price and to pro­vide pri­or no­ti­fi­ca­tion of any planned phar­ma­ceu­ti­cal trans­ac­tion val­ued at $25 mil­lion or more. Mul­leady, Vy­era, and Phoenixus al­so are pro­hib­it­ed for 10 years from en­gag­ing in any con­duct sim­i­lar to what the FTC and the states al­leged in their com­plaint.

For every de­fen­dant ex­cept Shkre­li, this set­tle­ment re­solves all claims brought by the FTC and the states, the FTC said, as well as those brought in a re­lat­ed class ac­tion suit. The tri­al against Shkre­li is set to be­gin on Dec. 14.

The or­der re­quires Vy­era and Phoenixus to pay up to $40 mil­lion to­tal — $10 mil­lion is guar­an­teed up­front and up to $30 mil­lion more is payable over 10 years if the com­pa­nies’ fi­nan­cial con­di­tion im­proves. The Com­mis­sion vote au­tho­riz­ing staff to seek en­try of the or­der in the US Dis­trict Court for the South­ern Dis­trict of New York was 4-0.

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