On Friday, August 4, 2017, another interesting development relating to drugs occurred. On that day, a federal court in New York found fund manager Martin Shkreli guilty of three counts of fraud. He could spend up to twenty years for this conviction.
According to the court, Shkreli mislead investors about the value and the performance of hedge funds that he managed. (Lying to investors is illegal.) Prosecutors also said that Shkreli used profits from these funds to start the pharmaceutical company Retrophin and used Retrophin’s assets to pay the investors of the hedge funds. He was acquitted of the charges relating to Retrophin.
This is not the first time Shkreli has encountered problems relating to drug companies. In 2015, as CEO of Turing Pharmaceuticals, Shkreli became infamous for his decision to raise the price of the drug Daraprim from to $13.50 a pill to $750.00 for the same dosage. Daraprim is a prescription drug used to treat and prevent parasitic infections and can save lives.
Given that its products are costly and can cause addictions, this decision did not help the often-poor reputation of the pharmaceutical industry. In fact, many people refer to the industry as Big Pharma, just as the labels Big Tobacco and Big Oil refer to other controversial industries and products.
Such labels are easy and cute, but not 100% accurate. On one hand, the pharmaceutical industry is a massive multibillion-dollar industry that may engage in unethical, dangerous practices. One could argue that Shkreli’s decision to raise the price of Daraprim is one such practice.
On the other hand, the pharmaceutical industry is an industry whose products have improved and saved the lives of many. People do become addicted to the industry’s products, but the industry’s products have also helped other people with addictions through the use of naloxone, Suboxone, and other drugs.
For some, Martin Shkreli might be a symbol of everything wrong with the pharmaceutical industry and even capitalism. But as with most things in life, drugs, drug addiction, and the pharmaceutical industry are more complex than they first appear.
