Frank Lucas. El Chapo. Pablo Escobar. These men all share the infamy of taking the illegal drug industry by storm. However, none of them were able to do so without feeling the wrath of the DEA and other authorities. They were forced to run their dynasties under the table. But one man has succeeded in creating a vast drug empire while abiding by the law of the land: Martin Shkreli.
Martin Shkreli is the notorious pharmaceutical entrepreneur and business mastermind whose net worth, at one point, was quoted at close to $100 million US dollars. There’s no shortage of negative press on Shkreli. In fact, he’s often referred to as “The Most Hated Man in America.” How did Shkreli become so financially fluid? Let’s review:
Martin Shkreli worked his way up the ladder as an associate at Cramer, Berkowitz and Company for four years and his excellence allowed him to launch his own hedge funds, Elea Capital Management and later MSMB Capital Management1. Under MSMB Capital, Shkreli founded the pharmaceutical company “Retrophin”, a “biopharmaceutical company focused on the discovery and development of drugs for the treatment of catastrophic diseases.”2
Although Shrkeli faced his share of legal controversy along the way, including allegations of securities fraud, no one can dispute the success of his capitalistic endeavors. Shrekli’s company Retrophin acquired the rights to market Thiola, “a drug used to treat the rare disease cystinuria.”2 While Shkreli headed Retrophin, the prices of Thiola rose from $1.50 per pill to a staggering $30. That insane price increase was only the beginning of Martin Shkreli’s journey toward becoming the world’s most hated man.
In February of 2015, , Shkreli founded “Turing Pharmaceuticals.” He realized that he could make a fortune if he was able to “[obtain] licenses on out-of-patent medicines and reevaluate the pricing of each in pursuit of windfall profits for the new company, without the need to develop and bring its own drugs to market.”3 Shkreli chose a target market with a consistent influx of new patients, suffering from one of the most threatening viruses known to humanity, HIV/AIDS.
On August 10, 2015, Turing acquired the drug Daraprim, an anti-parasitic that is used to treat patients with AIDS-related and AIDS-unrelated toxoplasmosis.4 Although some thought the pricing spike on Thiola was horrendous, that act was infinitely minimal compared to the price spikes in Daraprim. It has been reported that the price of a dose of the drug in the U.S. market increased from “$13.50 to $750 per pill, overnight, a factor of 56.”5 One must wonder how an individual could live with himself knowing that they are literally preventing the well-being of millions who are diagnosed with the life-threatening sickness. Martin Shkreli’s actions have been highly criticized by many professionals in the pharmaceutical industry and even by highly regarded politicians, proving bipartisanship can come second to matters of life and death.
Although Shkreli continues to generate revenue through sales of Daraprim, many HIV patients are becoming optimistic about their future, thanks to multiple substitutes finding their way into the mainstream. On October 22, 2015, Mark Baum, CEO of Imprimis Pharmaceuticals, announced that his company would provide a “combination product containing Pyrimethamine, the active ingredient in Daraprim, and Leucovorin at “$1-a-pill” as a cheaper and more efficient alternative to Daraprim.”6 The good news doesn’t stop there. A group of high school students from Sydney, Australia have created a replica of the $750 pill and are making it available to the public for only $2 per pill, a gigantic fraction of Daraprim’s price. The most shocking development from their work is that the students “spent about $15 on the materials needed to produce 3.7 grams of Daraprim, [which is] about $100,000 worth of the drug in the U.S. market,”7 stated Alice Williamson, a postdoctoral teacher associated with the project. It’s true what they say: it’s better to work smarter rather than harder. These students are prime examples.
We live in an age of entrepreneurialism where many over-glorify the notion of achieving the “American Dream.” All too often, we equate value with monetary status. But, the reality is that true worth is rooted in our humanity. Since Shkreli’s incident with his price spike, he has continued to provide fodder for the media. In hypocritical fashion, Shkreli blew the whistle on the UK-drug maker “Mallinckrodt”, ironically, for increasing the price of a drug that treats infant spasms by 85,000%. In other news, Martin Shkreli became an advocate of President Donald Trump’s campaign with his personal “Make Pharma Great” slogan and even stated that if Donald Trump won, he would release the exclusive lone Wu-Tang Clan album he had purchased in an auction, a promise he later fulfilled via a live stream.
Shkreli was presented with an opportunity to make millions by exploiting the suffering of others – and he took it. Most individuals with a conscience would decline. Time and time again Martin Shkreli has, unfortunately, ignored that voice of reason. But like all drug lords before him who once rose to the top, Shkreli too, will come crashing down to a bitter end.