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news.The US Securities and Exchange Commission has charged Turing Pharmaceuticals CEO Martin Shkreli for committing a series of securities fraud over a five-year period when he was also working as a hedge fund manager.
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Shkreli is alleged of misappropriating money from two hedge funds he established and made material misrepresentations to investors among other widespread misconduct.
Shkreli earlier faced criticism for drastically increasing the price of Daraprim drug, which is used to treat a life-threatening infection, to $750 per tablet from $13.50.
Shkreli, who was arrested by the Federal Bureau of Investigation (FBI) after the SEC’s charge, has been released on a $5m bond.
The SEC’s complaint filed in federal district court in Brooklyn states that Shkreli misappropriated around $120,000 from MSMB Capital Management from October 2009 to July 2011 to unlawfully pay for food, clothing, medical expenses, clothing, office rent, and cash withdrawals.
He was also charged of misappropriating $900,000 from another hedge fund MSMB Healthcare in 2013 to settle claims asserted by MSMB Capital Management’s executing broker from the losses incurred in the short selling transaction.
Turing Pharmaceuticals bought the US rights to Daraprim in August from Impax Laboratories.
Turing Pharmaceuticals said the legal matters concerning Shkreli are personal and have no bearing on the company.
"We maintain our deep commitment to patients, providers, and the progress of our important R&D pipeline."