Martin Shkreli Arrested on Charges of Securities Fraud

The pharmaceutical executive reviled for price-gouging resigned Friday as head of the drugmaker Turing Pharmaceuticals, a day after being arrested in NY on charges of securities fraud related to a company he previously ran. He has since been released on a $5 million bond.

The charges against Shkreli are unrelated to his work at Turing, but it’s his actions at the company that brought him into the public consciousness in September.

The privately held company announced that Ron Tilles, the chairman of the privately-held biopharmaceutical company, will serve as interim CEO while retaining his current position.

“Martin Shkreli engaged in multiple schemes to ensnare investors through a web of lies and deceit”, Robert Capers, US Attorney for the Eastern District of NY, told the media.

A seven-count indictment unsealed in Brooklyn federal court Thursday charged Shkreli with conspiracy to commit securities fraud, conspiracy to commit wire fraud and securities fraud.

Shkreli rose to infamy earlier this year when Turing jacked up the cost of a life-saving AIDS pill by more than 5,000%.

“No seizure warrant at the arrest of Martin Shkreli today, which means we didn’t seize the Wu-Tang Clan album”, the FBI’s official Twitter account in NY said.

Shkreli claimed that the revenue generated by the higher price of Daraprim would be used to fund research into new drugs, but most of the spending to date at Turing has gone to hiring scores of “business development” employees who sit in front of Bloomberg terminals in the NY office, according to people who have visited.

Turing did not address Shkreli’s arrest, though it did note Turing is “committed to ensuring that all patients have ready and affordable access to Daraprim and Vecamyl”-the very drugs that brought Shkreli into the spotlight after he raised their prices”. The Deerfield-based company has been calling for Turing to lower the price.

Shkreli is also the CEO of KaloBios, a publicly traded company that saw its shares drop 53 percent yesterday.

Shkreli was removed Retrophin, the company he helped built, because of misconduct.