U.S. District Judge Denise L. Cote wrote that the one-time "Pharma Bro" violated state and federal laws in exerting monopoly power over Daraprim, which is used to treat parasitic infections and HIV. (Photo: Diego M. Radzinschi/ALM)
A New York federal judge on Friday ordered Martin Shkreli to pay nearly $65 million and banned the disgraced former executive from ever working in the pharmaceutical industry again, siding with Attorney General Letitia James in a high-profile lawsuit stemming from his move to dramatically raise the price of a life-saving drug in 2015.
U.S. District Judge Denise L. Cote said in a 135-page opinion that Shkreli, whose exploits once gave him the derogatory moniker "Pharma Bro," violated state and federal laws in exerting monopoly power over Daraprim, which is used to treat parasitic infections and HIV.
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James and the Federal Trade Commission filed the antitrust case against Shkreli and his former firm, Vyera Pharmaceuticals, in 2020, alleging that Shkreli and his former partner, Kevin Mulleady, had used a combination of restrictive agreements and data secrecy in order to stifle generic competition for the drug.
The lawsuit was later joined by California, Illinois, North Carolina, Ohio, Pennsylvania and Virginia.
Vyera and Mulleady last month settled the case, agreeing among other things to pay as much as $40 million to offset illegal gains. Mulleady also agreed to his own seven-year ban from the pharmaceutical industry as a part of the settlement.
Shkreli was also ordered in 2018 to pay a $7.4 million forfeiture judgment to the federal government, which included having to turn over a one-of-a-kind Wu-Tang Clan album he infamously purchased in 2015.
Cote's decision Friday followed a seven-day trial, which featured live testimony from Vyera employees, generic drug manufacturers and experts that concluded last month in a Manhattan courtroom.
Shkreli, who is currently serving a seven-year prison sentence following his 2017 conviction on unrelated fraud charges, did not attend the trial, after Cote refused his request to testify remotely from a Pennsylvania prison.
As a part of the ruling, Shkreli was barred for life from participating in the pharmaceutical industry in any capacity and required to pay $64.6 million in disgorgement.
He was represented in the case by attorney Christopher Casey and a team of attorneys from Duane Morris in Philadelphia.
"'Envy, greed, lust, and hate,' don't just 'separate,' but they obviously motivated Mr. Shkreli and his partner to illegally jack up the price of a life-saving drug as Americans' lives hung in the balance," James said in a statement, quoting the Wu-Tang Clan song "A Better Tomorrow."
According to media reports, Shkreli was said to have paid $2 million for a Wu-Tang album issued in a unique edition. That album was forfeited to the federal government and sold for an undisclosed amount, according to an NPR story.
"The rich and powerful don't get to play by their own set of rules, so it seems that cash doesn't rule everything around Mr. Shkreli," James added in another overt reference to the iconic rap group. "New Yorkers can trust that my office will do everything possible to hold the powerful accountable, in addition to fighting to protect their health and their wallets."
An attorney for Shkreli did not immediately respond to a request for comment.
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Tom McParland
Tom McParland of New York Law Journal can be contacted at [email protected]. Follow him on Twitter @TMcParlandALM.
