Shkreli loses CEO job at another pharma firm

Kevin McCoy | USA TODAY

Embattled businessman Martin Shkreli has been ousted as CEO of KaloBios Pharmaceuticals (KBIO), the company said Monday, four days after federal authorities accused him of securities fraud involving other firms he controlled.

San Francisco-based KaloBios said Shkreli was "terminated" Dec. 17 — the day federal prosecutors and regulators accused him of defrauding investors in two hedge funds he operated and siphoning funds from a separate pharmaceutical firm to hide the losses.

Shkreli also resigned from the KaloBios board of directors, the company said. Tony Chase, who had been added to the board when Shkreli's Turing Pharmaceuticals gained control of KaloBios in November, also resigned, the company said.

Shkreli separately resigned from Turing's board on Friday.

The KaloBios ouster marks the latest setback for the 32-year-old healthcare industry entrepreneur who has drawn widespread criticism for imposing steep price hikes in the cost of drugs controlled by his companies.

The increases include a more than 5,000% jump in Turing's price for Daraprim — from $13.50 per pill to $750. The medication is used to treat toxoplasmosis, a parasitic disease that afflicts people with compromised immune systems, such as pregnant women and individuals afflicted with AIDS.

However, the criminal and civil charges against Shkreli are not related to drug pricing.

Instead, federal prosecutors in Brooklyn and the Securities and Exchange Commission last week alleged Shkreli illegally took stock from Retrophin (RTRX) — a biotechnology company he started in 2011 and was ousted from in 2014 — to pay off unrelated business debts.

The debts allegedly were owed to investors defrauded in two now-defunct Shkreli hedge funds that focused on health care investments: MSMB Capital and MSMB Healthcare.

"I am confident I will prevail. The charges against me are baseless and without merit," Shkreli, who is free on $5 million bond, tweeted on Saturday.

His Twitter account was hacked by an unknown attacker on Sunday. Shkreli tweeted on Monday that he had regained control of the account.

I was hacked--I now have control of this account. -- @MartinShkreli — Martin Shkreli (@MartinShkreli) December 21, 2015

He also told The Wall Street Journal he believed that federal authorities targeted him over the drug price hikes and his in-your-face style defending his decisions via statements and videos in social media and interviews with news organizations.

"'Trying to find anything we could to stop him,' was the attitude of the government," Shkreli said in the interview as he was flanked by his attorneys, the Journal reported.