Attorney General James Adds States to Suit Against Convicted Criminal Martin Shkreli and Vyera Pharmaceuticals

Multiyear Investigation Found Shkreli and Vyera Stifled
Competition After Raising Prices More Than 4,000 Percent

Lawsuit Seeks Repayment of Illegally Obtained Profits,
Lifetime Ban on Shkreli Working in Pharmaceutical Industry

NEW YORK – New York Attorney General Letitia James today announced that the attorneys general of six additional states have joined the lawsuit against Vyera Pharmaceuticals — previously known as Turing Pharmaceuticals — and two of its former CEOs — including convicted criminal Martin Shkreli. The states of California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia join the suit originally filed by Attorney General James and the Federal Trade Commission (FTC) against Vyera in January for stifling competition to protect the exorbitant, monopolistic pricing of the drug Daraprim (pyrimethamine). Daraprim is used to treat the parasitic disease toxoplasmosis, and despite Vyera Pharmaceuticals being the only FDA-approved source of the medication, Shkreli and Vyera raised the price of the drug by more than 4,000 percent overnight, to $750 per pill, after they purchased the rights to Daraprim in August 2015.

“As the nation battles COVID-19 and individuals with weakened immune systems find themselves more susceptible to the disease, convicted criminal Martin Shkreli and his company still continue to gouge those who are immunocompromised for a life-saving drug,” said Attorney General James. “A bipartisan group of six additional attorneys general are joining our lawsuit today because Mr. Shkreli’s unlawful conduct will not go unanswered. No company or individual has the right to illegally maintain a monopoly and line their pockets at the expense of vulnerable patients.”

Daraprim is the only Food and Drug Administration (FDA)-approved drug for the treatment of toxoplasmosis, a parasitic disease which may pose serious and often life-threating consequences for those with compromised immune systems, including babies born to women infected with the disease and individuals with the Human Immunodeficiency Virus (HIV). Daraprim has been the gold standard for treatment of toxoplasmosis for decades — recommended by the Centers for Disease Control and Prevention, the National Institutes of Health, the HIV Medicine Association, and the Infectious Diseases Society of America as the initial therapy of choice for toxoplasmosis. Nevertheless — and despite being unpatented — there has never been a generic version of Daraprim sold in the United States.  

Daraprim was cheap and accessible for decades, then, in August 2015, Vyera purchased the drug, increased the price, altered its distribution, and engaged in other conduct to delay and impede generic competition. The high price and distribution changes limited access to the drug, forcing many to make difficult and risky decisions for the treatment of a life-threatening disease.

After learning about Vyera’s exorbitant price increase, the Office of the New York Attorney General opened an investigation into Vyera, Shkreli, and his partner’s conduct. The office then shared its findings with the FTC and the two agencies worked together, culminating in January’s lawsuit.

Attorney General James, the FTC, and the six attorneys general joining the suit today allege that Vyera anticipated that its decision to increase the price of Daraprim by more than 4,000 percent would likely encourage entry into the market by other firms, so the pharmaceutical company took specific actions to impede and delay entry by competitors and preserve its monopoly. Among other things, Vyera prevented competitors from accessing a critical ingredient used to manufacture Daraprim. The lawsuit further contends that, as a result of Vyera’s anticompetitive conduct, generic entry continues to be delayed today — causing hospitals, physicians, and patients to pay exorbitant prices or otherwise be forced to make difficult treatment decisions without affordable access to the most effective treatment.

The coalition now seeks to enjoin Vyera’s conduct, as well as to obtain the return of unjust profits that would be distributed to the victims of the company’s illicit scheme. Additionally, Attorney General James is leading the coalition in asking the courts to issue an order banning both Shkreli — who is already serving a seven-year sentence in federal prison for securities fraud — and his business partner, Kevin Mulleady, from the pharmaceutical industry for life. 

The Office of the New York Attorney General wishes to thank the staff and leadership at the FTC for their partnership in this important matter.

The litigation is being led on behalf of New York by Assistant Attorneys General Saami Zain, Amy McFarlane, Bryan Bloom, Jeremy Kasha, and Kris Perez Hicks of the Antitrust Bureau, with supervision by Acting Bureau Chief Elinor Hoffmann. The Antitrust Bureau is a unit of the Division of Economic Justice, overseen by Chief Deputy Attorney General Christopher D’Angelo and First Deputy Attorney General Jennifer Levy.