FBI arrests Turing Pharmaceuticals CEO Martin Shkreli

Martin Shkreli, the former hedge fund manager under fire for buying a pharmaceutical company and ratcheting up the price of a life-saving drug, is in custody following a securities probe.

According to Bloomberg, Shkreli was arrested early Thursday at his home in Manhattan and charged with illegally taking stock from Retrophin Inc. and using it to pay off debts relating to his now-defunct hedge fund MSMB Captial Management.

The investigation predated the controversy surrounding Shkreli since September, when reports surfaced that his privately held Turing had raised the price of Daraprim, a 62-year-old treatment for a risky parasitic infection, to $750 a tablet from $13.50 after acquiring it. Reuters witnessed Shkreli’s arrest at the Murray Hill Tower Apartments in midtown Manhattan. The lawsuit looks similar to the federal case against Shkreli. He is alleged to have made secret payoffs and set up sham consulting arrangements. After his arrest, its stock fell by more than half Thursday before trading in the company was suspended.

Shkreli’s takeover of the firm sent shares soaring 400 percent on the first day after the news, and shares had since more than doubled in value. Headlines called him the “most hated man in America”.

Lawyers for Retrophin and Shkreli did not immediately respond to a request for comment. In recent days, he has said that journalists do not “matter” and asked about a Democratic presidential candidate, “If @BernieSanders was a parasite what would he be?” His company, Turing Pharmaceuticals AG, bought the drug, moved it to a closed distribution system and instantly drove the price into the stratosphere. On Twitter, the top hashtag and keyword related to Shkreli’s arrest was #Karma, with many saying on social media that the drug company executive was getting what he deserved. At a Forbes summit in NY this month, wearing a hooded sweatshirt, he said if he could have done it over, “I probably would have raised the price higher”, adding, “my investors expect me to maximize profits”.

Shkreli was also unmasked this month as the person who reportedly paid $2 million for the only copy of the new Wu-Tang Clan album, “Once Upon a Time in Shaolin”.

That subpoena also sought information about individuals or entities that had invested in funds previously managed by Shkreli, Retrophin said in a regulatory filing. Shkreli replied: “always fam”.