WASHINGTON – Infuriating members of Congress, a smirking Martin Shkreli took the Fifth at a Capitol Hill hearing Thursday when asked about his jacking up of drug prices, then promptly went on Twitter and insulted his questioners as “imbeciles.”
The brash, 32-year-old entrepreneur who has been vilified as the new face of pharmaceutical-industry greed was summoned by the House Oversight and Government Reform Committee, which is investigating soaring prices for critical medicines.
Four times, he intoned: “On the advice of counsel, I invoke my Fifth Amendment privilege against self-incrimination and respectfully decline to answer your question.”
Lawmakers erupted. Rep. Elijah Cummings of Maryland, the top Democrat on the committee, all but told Shkreli to wipe the smile off his face.
“I call this money blood money … coming out of the pockets of hardworking Americans,” he said as Shkreli sat through the lecture.
“I know you are smiling, but I am very serious, sir,” Cummings said. “I truly believe you can become a force of tremendous good. All I ask is that you reflect on it. No, I don’t ask, I beg that you reflect on it. “
The former hedge fund manager with a frat-boy swagger has been reviled in recent months for buying Daraprim, the only approved drug for a rare and sometimes deadly parasitic infection, and unapologetically raising its price more than fiftyfold.
Shkreli is out on $5 million bail after being arrested in New York in December on securities-fraud charges unrelated to the price increase.
Shkreli, wearing a sport jacket and open-collar shirt, was dismissed less than an hour into the hearing, but not before chairman Rep. Jason Chaffetz, R-Utah, shouted down a request by Shkreli’s attorney to speak. Lawmakers instead took turns denouncing his conduct and attitude.
Minutes after he left — and even before the hearing had ended — Shkreli thumbed his nose at the committee.
“Hard to accept that these imbeciles represent the people in our government,” the former CEO of Turing Pharmaceuticals tweeted.
Shkreli’s attorney Benjamin Brafman later said in his defence: “He meant no disrespect, but in truth, statements made by some of the members of the committee were wrong, unfair and difficult to listen to without responding.”
Shkreli calls himself “the world’s most eligible bachelor” and “the most successful Albanian to ever walk the face of this Earth.” He strums his guitar on YouTube and paid a reported $2 million for the only known copy of an album by the Wu-Tang Clan.
After Shkreli’s departure, Turing’s chief commercial officer and the interim CEO of Canada’s largest drugmaker, Valeant Pharmaceuticals, received a bipartisan lashing from the lawmakers.
Internal documents released by the committee show that Valeant and Turing have made a practice of buying and then dramatically raising prices for low-cost drugs given to patients with life-threatening conditions such as heart disease, AIDS and cancer.
Chaffetz, an admitted “conservative guy” who accepts that companies need to make profits, said he was disgusted. And Rep. Carolyn Maloney, D-N.Y., told them: “This is a scandal, an absolute abuse of power, an abuse of the pharmaceutical industry.”
With Shkreli mum, it was up to Turing’s Nancy Retzlaff to defend the Daraprim price rise. She said the company invests in research and development, as well as programs that help patients afford drugs. Turing tries to strike the right balance between those needs and rewarding shareholders, Retzlaff testified.
“I don’t believe my company has done anything wrong,” she said.
As early as last May, Turing planned to turn Daraprim into a $200-million-a-year drug by dramatically increasing its price, according to documents obtained by the committee. Turing bought the 60-year-old drug in August for $55 million.
Shkreli said in an email to one contact: “We raised the price from $1,700 per bottle to $75,000. Should be a very handsome investment for all of us.”
As for Valeant, documents indicate the company believed it could repeatedly raise the prices of the lifesaving heart drugs Nitropress and Isuprel without repercussions because the medicines are administered by hospitals, which are less price-sensitive than consumers.
AP Business Writers Tom Murphy in Indianapolis and Matthew Perrone in Washington contributed to this report.