The Federal Trade Commission and New York's attorney general filed a lawsuit Jan. 27, accusing Martin Shkreli —the former CEO of Turing Pharmaceuticals who became infamous for hiking the price of a lifesaving drug by 4,000 percent overnight — of scheming to thwart generic competition.
In 2015, shortly after Turing (now known as Vyera Pharmaceuticals) bought a drug called Daraprim, the only one approved to treat a serious parasite infection that affects HIV patients, Mr. Shkreli raised the list price from $17.50 to $750 per tablet, STAT reported.
The lawsuit alleges that Mr. Shrkeli and Vyera knew the price hike would cause generic drugmakers to try to make cheaper versions, so he used several methods to block competition.
One method was to stop generic drugmakers from buying samples of Daraprim, which they'd need to conduct testing required by the FDA.
Another was to make "data-blocking" agreements to stop drug distributors from selling data about Daraprim sales to third-party data companies. Generic drugmakers use this data to determine which drugs it should develop generic versions of, according to STAT.
Because Mr. Shkreli blocked generic competition, consumers and other purchasers of Daraprim likely spent tens of millions more than they would have if a generic version had been available, the lawsuit claims.
The FTC's Bureau of Competition voted 5-0 to file the lawsuit, the agency said in a news release.
"We filed this lawsuit to stop Vyera’s egregious conduct, make the company pay for its illegal scheming, and block Martin Shkreli from ever working in the pharmaceutical industry again," New York Attorney General Letitia James said in a news release. "We won’t allow ‘Pharma Bros’ to manipulate the market and line their pockets at the expense of vulnerable patients and the health care system."
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