Turing Receives $100 Million Offer on Drug That Made Martin Shkreli Famous

Turing Receives $100 Million Offer on Drug That Made Martin Shkreli Famous May 10, 2017
By Alex Keown, BioSpace.com Breaking News Staff

NEW YORK – Turing Pharmaceuticals could sell off its controversial toxoplasmosis drug, a drug the company acquired and then promptly increased its price by 5,000 percent.

Endpoints reported Tuesday that Turing has been offered $100 million for Daraprim. Turing acquired Daraprim in August 2015 from Impax Laboratories for $55 million, then increased the price from $13.50 per pill to $750 per pill. The price hike, plus the vigorous defense of that hike by the company’s founder Martin Shkreli, who resigned from Turing after being indicted on federal securities charges, became a lightning rod of criticism for the company. Writing in Endpoints, John Carroll said Turing Interim Chief Executive Officer Eliseo Salinas provided a letter to shareholders about the $100 million offer. The buyer is an unnamed third party.

The letter says the unnamed buyer “has conducted significant due diligence on Daraprim under a Confidentiality Agreement, and is committed to closing the transaction within 30 days of acceptance of the offer, subject to a possible delay for Hart-Scott-Rodino filing or other legal or regulatory reviews,” Carroll reported.

Daraprim is a 66-year-old drug used to treat toxoplasmosis. It was originally developed by GlaxoSmithKline . The drug is used by about 2,000 people in the United States annually for a period of six to 12 weeks.

Turing received the offer last week and is expected to provide an answer to the bidder by the end of May. In a statement provided to Endpoints, Turing confirmed the offer for Daraprim, but said it could not disclose information about the buyer.

Shkreli defended the price hike for Daraprim and said he should have increased the price even more. Prior to his arrest, Shkreli told a panel hosted by Forbes that as CEO of Turing his primary responsibility was maximizing profits for company shareholders. He and other company officials said the revenue generated from the price-hike would be used to fund a research into developing new treatments for toxoplasmosis.

Shkreli is currently awaiting trial for multiple charges of federal securities trade fraud. He is scheduled to go before a judge on June 26, 2017. The seven count indictment against Shkreli included multiple charges of securities fraud, securities fraud conspiracy and wire fraud conspiracy. U.S. Attorney Robert Capers accused Shkreli of running his former company Retrophin Pharmaceuticals and his former hedge fund MSMB Capital Management like a “Ponzi scheme.” The indictment said Shkreli’s scheme, which caused his investors to suffer a loss of more than $11 million, was carried out over a five-year period, from 2009 to 2014.

Shkreli said he would not be facing these charges had it not been for the ridicule he faced after the price hike, when he earned the moniker “the most hated man in America.”

As could be expected, the brash Shkreli has predicted he will be acquitted by the jury within two hours of deliberations. In an interview with The New Yorker, Shkreli said many of the jurors are likely to be fans of his.

In addition to resigning his position from Turing, Shkreli was removed as chief executive officer of California-based KaloBios , a company he acquired in November 2015. Since his forced removal from the pharma industry, Shkreli, ever an entrepreneur, has not remained idle. He is attempting to launch a new biotech-software company called Godel Systems. As of February, he has raised about $50,000 to support the venture. He is seeking $1 million in financing.

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