Martin Shkreli

Martin Shkreli (born March 17, 1983), commonly known as "Pharma Bro," is an American convicted felon, former hedge fund manager, and former pharmaceutical executive who became one of the most vilified figures in American business history after raising the price of the lifesaving drug Daraprim by more than 5,000% in 2015.

Shkreli founded multiple hedge funds, including Elea Capital Management and MSMB Capital Management, and pharmaceutical companies including Retrophin and Turing Pharmaceuticals. While his initial ventures focused on developing drugs for rare diseases, he became internationally notorious when Turing Pharmaceuticals acquired Daraprim—a medication essential for treating toxoplasmosis in AIDS patients and others with compromised immune systems—and raised its price from $13.50 to $750.00 per pill overnight.

In 2017, Shkreli was convicted of securities fraud unrelated to the Daraprim price hike, stemming from his management of his hedge funds. He was sentenced to seven years in federal prison and ordered to forfeit $7.4 million in assets, including the only copy of the Wu-Tang Clan album Once Upon a Time in Shaolin, which he had purchased for $2 million. He was released from prison in May 2022 after serving approximately five years.

Beyond his legal troubles, Shkreli became a cultural phenomenon through his combative social media presence, trolling behavior, and public feuds. He is permanently banned from serving as an officer of any publicly traded company and from participating in the pharmaceutical industry.

Early life and background

Family origins

Martin Shkreli was born on March 17, 1983, in Brooklyn, New York, into a working-class family of Albanian immigrants. His parents had emigrated from Albania to the United States, where they worked as janitors to support their family.

The Shkreli family traces its lineage to the Shkreli tribe in northern Albania, one of the traditional Albanian tribal communities. Despite their humble circumstances, the family maintained strong cultural ties to their Albanian heritage.

Shkreli grew up in Sheepshead Bay, a working-class neighborhood in southern Brooklyn, alongside two sisters and a brother. The experience of being raised by immigrant parents in modest circumstances would later inform Shkreli's drive to achieve financial success—though the methods he employed to do so would ultimately prove his undoing.

Religion

Shkreli was raised Roman Catholic, like many Albanian immigrants to the United States. He has described his religious upbringing as "a guiding post" for him, though he has also stated that he does not believe in God—a contradiction that mirrors the complex and often contradictory persona he has cultivated.

Education

Hunter College High School

Shkreli attended Hunter College High School, a selective public secondary school in Manhattan that admits students based on academic achievement. The school has produced numerous notable alumni across various fields.

However, Shkreli's tenure at Hunter remains somewhat unclear. Sources differ on whether he graduated from Hunter or was expelled before his senior year and completed his diploma through City-As-School High School, an alternative program.

What is clear is that Shkreli demonstrated academic ability and ambition from an early age—traits that would propel him to Wall Street while still a teenager.

Wall Street internship at 17

At age 17, through an educational program, Shkreli secured an internship at Cramer, Berkowitz and Company, a Wall Street hedge fund co-founded by Jim Cramer, the future host of CNBC's Mad Money.

This early exposure to the world of hedge funds and trading proved formative. Shkreli learned the basics of financial markets, trading strategies, and the aggressive culture that characterized certain corners of Wall Street.

Baruch College

Shkreli enrolled at Baruch College, part of the City University of New York system, where he studied business administration. He received his bachelor's degree in 2004.

Baruch's Zicklin School of Business has produced numerous successful finance professionals, and the school provided Shkreli with the formal business education to complement his practical Wall Street experience.

Early career

Cramer Berkowitz (2000-2004)

Following his high school internship, Shkreli returned to Cramer, Berkowitz and Company, where he worked for four years as an associate. During this time, he honed his skills in trading and market analysis while developing the aggressive, confrontational style that would later become his trademark.

At Cramer Berkowitz, Shkreli learned the art of short selling—betting that stock prices would fall—a strategy that would later become central to his hedge fund activities.

Intrepid Capital and UBS

After leaving Cramer Berkowitz, Shkreli worked as a financial analyst at Intrepid Capital Management and subsequently at UBS Wealth Management. These positions provided additional experience in institutional investing and wealth management.

Elea Capital Management (2006)

In 2006, at age 23, Shkreli founded his first hedge fund, Elea Capital Management. Named after an ancient Greek city in Italy associated with the philosopher Parmenides, the fund focused on healthcare and biotechnology investments.

Elea represented Shkreli's first attempt at running his own investment operation. While the fund was relatively small, it provided valuable experience in fundraising, investor relations, and portfolio management.

MSMB Capital Management

Founding (2009)

In September 2009, Shkreli and childhood friend Marek Biestek founded MSMB Capital Management, taking its name from the initials of the two founders. The hedge fund specialized in short selling biotechnology and pharmaceutical stocks.

MSMB's strategy involved identifying what Shkreli believed were overvalued or fraudulent companies in the healthcare sector, shorting their stocks, and then publicly criticizing the companies in stock trading chat rooms and on social media. This approach generated controversy but also attracted attention to the young fund manager.

Trading strategy

Shkreli developed a reputation for aggressive short-selling tactics. MSMB would establish short positions in biotech companies, then Shkreli would publish detailed critiques of the companies' drug candidates, management teams, and financial prospects in online forums.

Critics accused Shkreli of manipulating stock prices through this combination of trading and public commentary. Supporters argued he was simply providing valuable analysis of companies that were overvalued.

Orexigen collapse (2011)

MSMB's aggressive approach led to disaster on February 1, 2011. In a naked short sale, MSMB sold short 32 million shares of Orexigen Therapeutics stock—a massive position relative to the fund's capital.

When Orexigen's stock price rebounded rather than falling as Shkreli had predicted, MSMB could not cover its short position. Merrill Lynch, which had facilitated the trade, lost approximately $7 million. MSMB Capital was virtually wiped out.

The Orexigen debacle highlighted the risks of Shkreli's aggressive trading style and foreshadowed the legal troubles that would follow.

Retrophin

Founding and mission (2011)

In early 2011, as MSMB was collapsing, Shkreli pivoted to an entirely different business model. He founded Retrophin LLC, a biopharmaceutical company focused on developing orphan drugs—medications for rare diseases that large pharmaceutical companies often ignore because patient populations are too small to justify development costs.

Shkreli claimed to be motivated by learning about a teenage boy who died from Duchenne muscular dystrophy (DMD), a fatal genetic disease that affects approximately 1 in 3,500 male births. He signed an employment agreement to serve as CEO in March 2011, when he was just 27 years old.

Business model

Retrophin's approach combined acquiring existing drugs for rare diseases with developing new treatments. The company would obtain rights to medications that were effective but neglected, then charge high prices justified by the small patient populations and the company's commitment to research and development.

This model—acquiring existing drugs and raising prices—would later become the template for Shkreli's most controversial business practices.

Ouster (2014)

In September 2014, Retrophin's board of directors voted to remove Shkreli as CEO. He resigned the following month and was replaced by Stephen Aselage.

The board's stated reasons for the termination included allegations that Shkreli had used company assets to repay investors in his failed hedge funds—essentially using Retrophin as a vehicle to cover losses from MSMB Capital. These allegations would later form the basis for both civil lawsuits and criminal charges.

Lawsuits and settlement

After Shkreli's departure, Retrophin filed a $65 million lawsuit against him in August 2015, alleging that he had breached his fiduciary duties, committed stock-trading irregularities, and used company funds improperly. The lawsuit also alleged that Shkreli had threatened and harassed a former MSMB employee and his family.

Shkreli counter-sued from prison in 2019, accusing Retrophin's directors of using fraud to oust him. The parties eventually reached a settlement covering all disputes, though terms were not disclosed.

In November 2020, Retrophin rebranded as Travere Therapeutics Inc., explicitly to distance itself from its association with Shkreli.

Turing Pharmaceuticals and the Daraprim scandal

Founding Turing (2015)

Following his ouster from Retrophin, Shkreli founded Turing Pharmaceuticals in February 2015. The company's business strategy was straightforward: acquire licenses to out-of-patent medicines, then dramatically increase prices to generate profits without the need to develop new drugs.

Acquisition of Daraprim

On August 10, 2015, Turing acquired Daraprim (pyrimethamine) from Impax Laboratories for $55 million. Daraprim, first approved by the FDA in 1953, is used to treat toxoplasmosis, a parasitic infection that can be life-threatening for people with compromised immune systems, including AIDS patients, certain cancer patients, and the elderly.

Daraprim appears on the World Health Organization's List of Essential Medicines due to its importance in treating these vulnerable populations.

The 5,000% price increase

In September 2015, Shkreli made a decision that would make him internationally notorious: Turing raised Daraprim's price from $13.50 to $750.00 per pill—an increase of more than 5,000%.

The impact on patients was devastating. The average cost of treatment rose from approximately $1,130 to $63,000. For certain patients requiring extended treatment, costs could reach as high as $634,000.

"Pharma Bro" nickname

The price increase generated immediate outrage from patients, physicians, politicians, and the public. Shkreli's youth, brash manner, and apparent indifference to criticism made him a perfect villain for the digital age. He quickly acquired the nickname "Pharma Bro," which stuck despite—or perhaps because of—his obvious disdain for it.

Shkreli became the face of pharmaceutical industry greed, embodying public frustration with drug pricing practices. Hillary Clinton called the price increase "outrageous" and proposed reforms to drug pricing. Bernie Sanders and other politicians cited Shkreli in arguments for healthcare reform.

Justifications and criticisms

Shkreli defended the price increase by arguing that the profits would fund research and development for better treatments for toxoplasmosis. He claimed that Daraprim was underpriced relative to its value and that Turing would use the revenue to improve the medication.

Medical experts were skeptical. Wendy S. Armstrong, vice chair of the HIV Medicine Association (HIVMA), noted that "this is not an infection where we have been looking for more effective drugs." Daraprim was already highly effective, requiring only one pill daily with manageable side effects. The suggestion that massive price increases were needed to fund research rang hollow.

Anticompetitive practices

Beyond the price increase itself, Turing was later found to have engaged in anticompetitive practices to prevent generic competition. The company used restrictive distribution agreements to prevent potential competitors from buying Daraprim samples needed to develop generic versions. Turing also blocked competitors from accessing key ingredients required to replicate the drug.

These practices led to additional legal consequences. In a civil antitrust case, Shkreli was eventually ordered to pay $64.6 million in damages.

Securities fraud conviction

Federal investigation

While the Daraprim price hike attracted enormous public attention, Shkreli's legal troubles ultimately stemmed from his earlier hedge fund activities. Federal prosecutors investigated his management of MSMB Capital and Retrophin, uncovering what they alleged was a multi-million dollar fraud scheme.

Arrest (December 2015)

On December 17, 2015, just months after the Daraprim controversy erupted, FBI agents arrested Shkreli at his Manhattan apartment. He was charged with securities fraud and wire fraud related to his conduct at MSMB Capital and Retrophin.

The indictment alleged that Shkreli had lied to investors about MSMB's performance, then used Retrophin as a vehicle to repay MSMB investors when the hedge fund collapsed. Essentially, he was accused of operating a Ponzi scheme-like arrangement where new investors' money was used to pay off earlier investors.

Trial and conviction (2017)

In August 2017, a federal jury in Brooklyn found Shkreli guilty on two counts of securities fraud and one count of conspiracy to commit securities fraud. He was acquitted on several other charges.

The conviction established that Shkreli had defrauded investors, though notably not through the Daraprim price increase that had made him infamous. The drug pricing controversy remained a civil and regulatory matter rather than a criminal one.

Sentencing (2018)

On March 9, 2018, U.S. District Judge Kiyo Matsumoto sentenced Shkreli to seven years in federal prison. He was also ordered to pay a $75,000 fine and forfeit $7.4 million in assets.

The forfeiture order allowed the government to seize various assets, including $5 million from his bail account, the Wu-Tang Clan album Once Upon a Time in Shaolin, a Lil Wayne album called Tha Carter V, and a Picasso painting.

Bail revocation

Shkreli's bail was revoked in September 2017, two months after his conviction, following a bizarre incident on social media. He had offered his Facebook followers a $5,000 bounty for obtaining samples of Hillary Clinton's hair during her book tour.

Judge Matsumoto ruled that this offer constituted a threat to the former presidential candidate and ordered Shkreli remanded to custody immediately.

Wu-Tang Clan album

Purchase (2015)

In one of the most unusual episodes of Shkreli's already unusual life, he purchased the only copy of Once Upon a Time in Shaolin, a secret album by the hip-hop group Wu-Tang Clan, for $2 million in 2015.

The album had been recorded in secret over six years, from 2007 to 2013. A single two-CD copy was pressed and stored in a vault in Casablanca, Morocco, before being sold through auction. The purchase made Once Upon a Time in Shaolin the most expensive work of music ever sold.

Wu-Tang Clan's reaction

RZA, the Wu-Tang Clan's de facto leader, stated that the sale was agreed before Shkreli's Daraprim controversy became public. After learning the buyer's identity, RZA and fellow Wu-Tang member Cilvaringz donated a "significant portion" of the proceeds to charity.

The terms of the sale prohibited the buyer from commercially releasing or distributing the album until 2103—88 years after the purchase.

Forfeiture

Following his 2018 sentencing, Shkreli was forced to surrender the Wu-Tang Clan album to the federal government as part of his asset forfeiture. The album was held by the U.S. Marshals Service pending sale.

Government sale

In July 2021, the Department of Justice announced that the album had been sold to an anonymous buyer. Documents later revealed through FOIA requests showed that the buyer, WTC Endeavors, paid $2,238,482.30—approximately the amount Shkreli owed the government.

WTC Endeavors was later revealed to be associated with PleasrDAO, a cryptocurrency collective that turned the album into an NFT. PleasrDAO reportedly paid the equivalent of $4 million in cryptocurrency for full ownership rights.

2024 streaming controversy

In June 2024, Shkreli livestreamed the album on Twitter, despite no longer owning it and despite the restrictions on distribution. PleasrDAO filed a lawsuit against him for the unauthorized stream.

A federal judge ordered Shkreli to surrender all copies he had made and provide the names of anyone who had received a copy. The album began its first public exhibition at the Museum of Old and New Art in Hobart, Tasmania, in June 2024.

Prison and release

Incarceration

Shkreli served his sentence at the low-security federal prison in Allenwood, Pennsylvania. During his incarceration, he reportedly received credit for good behavior and for completing education and rehabilitation programs.

Early release (2022)

On May 18, 2022, Shkreli was released from federal prison and transferred to a Bureau of Prisons halfway house in New York to complete the remainder of his sentence. His release came approximately five years after his sentencing, reflecting various credits that reduced his effective sentence.

Additional penalties

In addition to his criminal sentence, Shkreli faced substantial civil penalties:

• In January 2022, a federal judge ordered Shkreli to return $64.6 million in wrongfully obtained profits from the Daraprim scheme, to be distributed to victims nationwide.

• In February 2022, a federal judge banned Shkreli for life from serving as an officer or director of any publicly traded company.

• Shkreli is also permanently banned from participating in the pharmaceutical industry.

Post-prison activities

Druglike and cryptocurrency (2022)

Following his release from prison, Shkreli announced plans for Druglike, described as a "Web3 drug discovery software platform." The venture aimed to provide cloud-based, decentralized computing services for pharmaceutical drug development.

As part of this project, Shkreli launched his own cryptocurrency called "Martin Shkreli Inu," an Ethereum-based token. Shkreli reportedly held approximately 16% of the token supply.

Crypto crash (August 2022)

In August 2022, the Martin Shkreli Inu token crashed by approximately 90% after an account believed to belong to Shkreli sold its holdings. Shkreli claimed the sale was due to a hack that occurred while he was attempting to download a pornography file.

The incident highlighted the risks and controversies that continued to surround Shkreli even after his prison release.

Trump coin claims (2024)

In June 2024, Shkreli claimed he and Barron Trump were responsible for creating a mysterious Trump-branded meme coin on the Solana blockchain. However, Shkreli was unable to provide proof of this collaboration, and the Trump family did not acknowledge his claims.

Regulatory scrutiny

State attorneys general, including those in North Carolina and New York, announced investigations into Druglike and whether Shkreli's activities violated his lifetime ban from the pharmaceutical industry.

Public persona and controversies

Social media presence

Throughout his career, Shkreli maintained an active and combative social media presence. He engaged directly with critics, often mocking them, and seemed to relish the attention—positive or negative—that his trolling generated.

His social media behavior contributed to his "Pharma Bro" image while also creating legal problems, as demonstrated by the bail revocation following his Hillary Clinton hair bounty.

Streaming and online engagement

Shkreli conducted frequent livestreams on various platforms, discussing markets, pharmaceuticals, and his legal troubles. These streams attracted devoted followers who appreciated his unconventional approach, as well as critics who viewed him as a symbol of everything wrong with the pharmaceutical and financial industries.

Congressional testimony

In February 2016, Shkreli was called to testify before the House Committee on Oversight and Reform regarding drug pricing. He invoked his Fifth Amendment right against self-incrimination and refused to answer most questions, at one point smirking at the congresspeople questioning him.

The appearance became another viral moment in Shkreli's ongoing public saga, with his demeanor reinforcing public perceptions of arrogance and contempt for accountability.

Legacy and cultural impact

Drug pricing debate

While Shkreli was hardly the first or only pharmaceutical executive to raise drug prices aggressively, his actions became a catalyst for broader public discussion of drug pricing in the United States. Politicians across the political spectrum cited Shkreli in arguments for reform, and his name became synonymous with pharmaceutical industry excess.

The Daraprim case illustrated how companies could acquire old, essential medications and dramatically increase prices without facing meaningful regulatory constraints.

Symbol of excess

Shkreli became a cultural symbol of unchecked capitalism and the excesses of the financial and pharmaceutical industries. His youth, brashness, and seeming indifference to the harm caused by his actions made him a convenient villain for multiple constituencies.

His purchase of the Wu-Tang Clan album, in particular, seemed to encapsulate a certain kind of wealthy entitlement—acquiring unique cultural artifacts simply because he could.

Ongoing notoriety

Even after his prison release, Shkreli continues to attract media attention. His cryptocurrency ventures, social media presence, and various controversies ensure that the "Pharma Bro" remains a public figure, though now largely outside the formal business world from which he has been banned.

Personal life

Little is publicly known about Shkreli's personal life beyond his legal troubles and business activities. He has never married and has no known children. He has discussed his Albanian heritage and Catholic upbringing in various interviews.

Shkreli has spoken about interests including chess, hip-hop music (as evidenced by his Wu-Tang Clan purchase), and financial markets. His public persona has always been more focused on his business and legal activities than personal matters.

Net worth

Estimates of Shkreli's current net worth vary widely and are difficult to verify. Before his legal troubles, he claimed to be worth approximately $70 million. However, the $7.4 million forfeiture, $64.6 million antitrust penalty, and various legal fees have substantially reduced whatever wealth he may have accumulated.

Some sources suggest his current net worth may be minimal or negative given his legal obligations. His cryptocurrency ventures have experienced significant volatility, further complicating any assessment.

Quotes

On Daraprim pricing: Defended the price increase as necessary to fund research, though critics noted the drug was already effective.

On congressional testimony: Invoked the Fifth Amendment, refusing to answer questions about drug pricing.

On his public image: "I'm not going to change who I am."

See also

• Turing Pharmaceuticals
• Retrophin
• Daraprim
• Securities fraud
• Pharmaceutical industry
• Drug pricing
• Once Upon a Time in Shaolin
• Wu-Tang Clan
• Hedge fund

External links

• Department of Justice press release on sentencing
• SEC litigation release