The youthful pharmaceutical CEO Martin Shrekli, nicknamed “Pharma Bro”, and “the most hated man in America," has been hit with a class-action lawsuit. Health insurers filed the lawsuit, alleging Shrekli plotted to create a drug monopoly.
The insurers are seeking damages to be determined by market overcharges in a trial by jury. The plaintiffs represent numerous third-party payers from thirty states.
Blue Cross Blue Shield of Minnesota filed their lawsuit in Manhattan federal court, alleging Shrekli and his corporation Vyera Pharmaceuticals schemed to create a pharmaceutical monopoly and worked to prevent competitors from getting their hands on free Daraprim samples.
Shrekli already made viral headlines for his legal escapades and is now in prison serving a seven-year sentence.
He was convicted of securities fraud for his management of two hedge funds. Found guilty of a Ponzi scheme to defraud investors of $11 million, Shrekli then infamously saw his request for bail denied for offering the public $5,000 for a strand of Hilary Clinton’s hair.
In 2015, the Trade Commission sued Shrekli for raising the price of an HIV drug by about 5,000 percent.
Lead plaintiff Blue Cross Blue Shield of Minnesota accused the Pharma celebrity of blocking drug “competitors from obtaining the Daraprim samples they needed to launch a generic product” and then denying it to the public.
Daraprim is the medicine that treats toxoplasmosis and is also given to HIV patients since it helps a compromised immune system.
In the absence of any competition for Daraprim, the medicine went from costing $13.50 per tablet to about $750 overnight, a 5,000 percent price hike.
The lawsuit alleges that Shrekli, Vyera, and parent company Phoenixus AG, plus executive Kevin Mulleady “executed a multifaceted plan to enrich themselves and maintain their monopoly.”
Blue Cross and Blue Shield of Minnesota said in a public statement that the defendants, who owned 100 percent of the market for Daraprin until 2020, had a responsibility not to gouge consumers for vital medicine.
Dr. Craig Samitt, president and CEO at Blue Cross and Blue Shield of Minnesota, said, "Everyone deserves access to safe, effective, and affordable medication. This lawsuit is an important step in advancing that goal. Drug companies need to be held accountable for their role in making sure health care costs are sustainable for all.”
A new, affordable generic version of Darapri, Pyrimethamine, was approved a few days ago by the FDA and is expected to be available soon.
Shrekli, who has twice applied for compassionate prison time reduction, was once again denied last week.
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