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Ex-Hedge Funder Buys Rights to AIDS Drug and Raises Price From $13.50 to $750 per Pill

A former hedge fund manager and head of a pharmaceutical company has purchased the rights to a 62-year-old drug that is used to combat the AIDS virus. Martin Shkreli, 32, decided to purchase the drug in order to gouge patients who rely on it to stay alive.

Immediately after purchasing Daraprim, he raised the price from $13.50 to $750 per tablet. The drug is used for treating toxoplasmosis, a serious parasitic infection that can be life-threatening.

According to Shkreli, his company was bleeding out and increased the price in order to stay afloat.

“This isn’t the greedy drug company trying to gouge patients, it is us trying to stay in business,” Shkreli explained, saying that many patients use the drug for far less than a year and that the new price is similar to other drugs used for rare diseases.

Raw Story reports:

Prices have increased as the rights to the drug have been passed from one pharmaceutical company to the next, but nothing like the almost 5,500 percent increase since Shkreli acquired it.

Worrying that the cost of treatment could devastate some patients, Dr. Judith Aberg, the chief of the division of infectious diseases at the Icahn School of Medicine at Mount Sinai asked, “What is it that they are doing differently that has led to this dramatic increase?”

According to Shkreli, Turing will use the money it earns to develop better treatments for toxoplasmosis, with fewer side effects.

Prices have increased as the rights to the drug have been passed from one pharmaceutical company to the next, but nothing like the almost 5,500 percent increase since Shkreli acquired it.

Worrying that the cost of treatment could devastate some patients, Dr. Judith Aberg, the chief of the division of infectious diseases at the Icahn School of Medicine at Mount Sinai asked, “What is it that they are doing differently that has led to this dramatic increase?”

According to Shkreli, Turing will use the money it earns to develop better treatments for toxoplasmosis, with fewer side effects.

Shrkeli also defended his small pharmaceutical company saying, “It really doesn’t make sense to get any criticism for this.”

This is not the first time the fledgling pharmaceutical executive has come under scrutiny.

He started the hedge fund MSMB Capital while in his 20’s and was accused of urging the FDA to not approve certain drugs made by companies whose stock he was shorting.

In 2011, Shkreli helped form Retrophin, which also acquired old drugs and immediately raised their prices. Retrophin’s board fired Shkreli a year ago and has filed a complaint in Federal District Court, accusing him of using Retrophin as a personal fund to pay back angry investors in his hedge fund.

As for Shrkeli’s claim that he will put the excess profits back into research, doctors say that isn’t needed in this case.

“I certainly don’t think this is one of those diseases where we have been clamoring for better therapies,” said Dr. Wendy Armstrong, professor of infectious diseases at Emory University in Atlanta.

Photo credit: Twitter.

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  • bfloyd47

    I didn’t know ‘asshole’ was spelled that way.