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Clear out junk files and repair common Windows errorsFree Scan →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Martin Shkreli’s downfall came through two separate legal cases—not one prosecution over Daraprim’s price. A federal jury convicted him of securities fraud involving hedge-fund investors and Retrophin; years later, the FTC and state enforcers pursued him over conduct that protected the market position of Daraprim, an older antiparasitic drug. The first case brought prison and criminal forfeiture. The second ended with a lifetime pharmaceutical-industry ban and $64.6 million in disgorgement.
How Shkreli became known as “Pharma Bro”
Shkreli was a hedge-fund manager and pharmaceutical executive whose public reputation became closely tied to Daraprim, the brand name for pyrimethamine. In August 2015, Turing Pharmaceuticals acquired U.S. rights to the drug and raised its list price from $17.50 to $750 per tablet, according to the FTC’s case record and the Second Circuit’s later account. FTC case record · Second Circuit opinion
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The price increase attracted widespread criticism, but it was not the conduct for which Shkreli was convicted of securities fraud. The criminal case concerned investors and company stock. Daraprim became the subject of a distinct civil antitrust case, which examined whether the companies and Shkreli used exclusionary tactics to protect the drug’s market position and keep generic competitors from entering effectively.
The criminal case: securities fraud and investors
In August 2017, a federal jury convicted Shkreli on two securities-fraud counts and one count of securities-fraud conspiracy. The U.S. Department of Justice described the schemes as involving investors in his hedge funds and Retrophin stock. U.S. Department of Justice
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In March 2018, the court sentenced him to seven years in prison and three years of supervised release. The sentence also included a $75,000 fine and $7.3 million in forfeiture, according to the DOJ. These were criminal-case penalties; they were separate from the later antitrust remedies connected to Daraprim.
The Daraprim antitrust case: alleged tactics and court findings
The FTC and state enforcers alleged that Turing and related companies, later known as Vyera and Phoenixus, worked to protect the Daraprim price by making it difficult for would-be generic competitors to obtain drug supply and important market information. The FTC described distributor resale restrictions, exclusive arrangements for the active pharmaceutical ingredient pyrimethamine, and agreements that blocked access to data needed to assess the market. FTC settlement announcement
In December 2021, the FTC announced that Vyera and Phoenixus had agreed to up to $40 million in equitable monetary relief and measures intended to help generic competitors access Daraprim. That settlement resolved claims against the companies; Shkreli’s personal liability was still being litigated at that point.
In January 2022, the U.S. District Court for the Southern District of New York found Shkreli liable in the antitrust action. The court ordered $64.6 million in disgorgement and barred him for life from participating in the pharmaceutical industry. In describing the conduct, the district court used the words “egregious, deliberate, repetitive, long-running, and ultimately dangerous,” as quoted in the appellate opinion. FTC case record · Second Circuit opinion
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| Case | What it concerned | Outcome for Shkreli |
|---|---|---|
| Securities-fraud prosecution | Investor and stock schemes involving hedge funds and Retrophin, prosecuted by the U.S. Attorney’s Office. | Jury conviction in 2017; seven years’ imprisonment, supervised release, a fine, and criminal forfeiture in 2018. DOJ |
| Daraprim antitrust action | FTC and state enforcers’ claims about conduct to preserve the drug’s market position and impede generic competition. | Civil liability, $64.6 million in disgorgement, and a lifetime pharmaceutical-industry ban, affirmed on appeal. FTC case record · Second Circuit opinion |
The sums in the two cases also serve different legal purposes. The DOJ’s $7.3 million figure was criminal forfeiture imposed in the securities-fraud case. The $64.6 million was disgorgement ordered against Shkreli in the civil antitrust case. The companies’ separate agreement to provide up to $40 million in relief was not a payment imposed on Shkreli personally.
Appeals and what happened to the Wu-Tang album
In January 2024, the Second Circuit affirmed the antitrust judgment, including the lifetime ban. In October 2024, the Associated Press reported that the U.S. Supreme Court rejected Shkreli’s appeal of the disgorgement order. The AP also reported that the Wu-Tang Clan’s one-of-a-kind album Once Upon a Time in Shaolin was ordered forfeited in the criminal case. That forfeiture belonged to the securities-fraud proceeding, not the Daraprim antitrust case. Associated Press
Why the “dose of karma” story needs two timelines
The phrase “Pharma Bro” tends to compress Shkreli’s notoriety into a single story about an extreme drug-price increase. The legal record is more specific: the criminal conviction addressed fraud involving investors and Retrophin, while the Daraprim case addressed antitrust conduct alleged by enforcers and later found unlawful by the district court. The Supreme Court action reported in October 2024 followed the antitrust appeal; it did not turn the Daraprim price increase into the basis of the criminal conviction.
The FTC’s chair at the time, Lina M. Khan, said in the agency’s December 2021 announcement: “Martin Shkreli masterminded an elaborate plan to dramatically jack up the price of life-saving drug Daraprim by blocking cheaper options.” That was Khan’s characterization in an agency statement; the court findings and remedies in the antitrust case are set out separately in the court record.
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