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Regulatory Focus™ > News Articles > 2020 > 1 > FTC, New York Sue Shkreli, Former Company Over Blocking Daraprim Generics

FTC, New York Sue Shkreli, Former Company Over Blocking Daraprim Generics

Posted 27 January 2020 | By Zachary Brennan 

FTC, New York Sue Shkreli, Former Company Over Blocking Daraprim Generics

The Federal Trade Commission (FTC) and New York Attorney General on Monday filed a lawsuit against Vyera Pharmaceuticals, which was previously known as Turing Pharmaceuticals and was run by the infamous “Pharma Bro” Martin Shkreli, who is currently serving a seven-year prison term.

Shkreli rose to infamy back in 2015 for raising the price of the toxoplasmosis drug Daraprim (pyrimethamine), first approved by FDA in 1953, from $17.50 to $750 per tablet, or $1,700 per bottle to $75,000 per bottle. Shkreli later laughed at a House Oversight Committee hearing before invoking his Fifth Amendment rights.

A month later, a couple whose newborn was diagnosed with toxoplasmosis explained to a Senate committee how, after their insurers denied coverage for the drug, they assumed the worst before the University of North Carolina agreed to purchase supplies of the drug and sell it to the couple for about $40 per month.

The FTC and New York lawsuit explains how Vyera withheld samples of the drug so that generic competitors could not conduct bioequivalence testing and enter the market. For instance, in August 2015, Vyera and a Daraprim distributor agreed that the distributor would not sell more than five bottles to a single customer without Vyera’s express approval.

In August 2019, the redacted suit also says that Shkreli had several conversations about limiting all sales of Daraprim to one bottle at a time in order to prevent a generic competitor from obtaining sufficient Daraprim samples to conduct the necessary testing.

Former Turing Pharma SVP and general counsel Howard Dorfman also told senators in 2015 that the drug was intentionally put into a closed distribution system to keep generics from the market and to ensure the company held its monopoly. Dorfman was fired without cause after expressing concern about the company’s business model.

And when Ipca Laboratories, one of two active pharmaceutical ingredient suppliers for Daraprim, was placed on import alert by FDA in 2015, the suit says Vyera “touted how this import ban would cause ‘significant disruption’ and delay to generic companies planning or desiring to use Ipca.”

Vyera also sought to prevent its distributors from selling Daraprim sales information to IQVIA or other data reporting companies, although the suit says the wholesalers’ Daraprim sales data was not Vyera’s to control. And other redacted sections seem to suggest that a generic version of Daraprim would be on the market today if it was not for Vyera’s tactics.

Attorney General Letitia James added: “We filed this lawsuit to stop Vyera’s egregious conduct, make the company pay for its illegal scheming, and block Martin Shkreli from ever working in the pharmaceutical industry again.”



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