Shkreli Wasn’t the First to Hike Drug Prices—and He Won’t Be the Last

Call it a case of tempting fate or instant karma—the cosmos sought its inevitable revenge when Martin Shkreli, the hip-hop-loving, drug-price-inflating biotech executive, was arrested, indicted, and perp-walked on Dec. 17. But the activities that got him crosswise with the feds aren’t what the 32-year-old Twitter addict with the sardonic smirk will be remembered for. What’s so troubling and important about his story is that the way he ran his drug companies—the amoral but probably legal business plans he employed—were of a piece with mainstream pharmaceutical marketing.

Federal prosecutors described Shkreli’s doings as “Ponzi-like” and charged him with fraud, claiming that he fleeced a company he started in 2011 called Retrophin. He allegedly used its stock and cash to pay off investors who’d suffered losses at small hedge funds he’d previously run into the ground. Unlike the typical Ponzi artist—think Bernie Madoff—Shkreli started real companies that acquired real products and accumulated hundreds of millions of dollars in value, at least in the eyes of Wall Street.