In comeback bid, Shkreli’s old company gets OK to buy life-saving drug

(credit: Glenn Seplak)

After firing the infamous Martin Shkreli as its CEO, filing for bankruptcy, and getting delisted from the NASDAQ stock exchange, KaloBios Pharmaceuticals, Inc. may now be poised for a comeback—thanks to a Shkreli-inspired plan to jack-up the price of a life-saving drug and exploit a federal voucher system.

On Friday, KaloBios’ bankruptcy court in Delaware authorized the pharmaceutical company to enter into a binding deal to buy the worldwide rights to one of only two drugs used to treat Chagas disease, a neglected and life-threatening parasitic infection. With the deal, which was planned by Shkreli prior to his departure, the company plans to raise the price of the drug possibly by 600-fold or more. It will also use the drug’s status as one that treats a neglected tropical disease to earn a voucher from the Food and Drug Administration. Such vouchers allow drug companies to move through the drug-approval process faster, and they could be sold to other pharmaceutical companies for hundreds of millions of dollars.

When KaloBios and Shkreli first revealed the plan late last year, it sparked outcry from public health experts and infectious disease doctors who feared that the new cost would make it difficult for the millions of patients in Central and South America to get the drug. Those fears were put on ice following KaloBios’ series of troubles stemming from Shkreli’s arrest on fraud charges in December, but Friday’s news is likely to reignite concern as the company moves forward as planned.

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