In early December 2021, the United States Federal Trade Commission (FTC), along with several state co-plaintiffs (New York, California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia), filed an order in court indicating a $40 million settlement had been reached with Vyera Pharmaceuticals. Readers may remember the “pharma bro” saga with former Vyera CEO Martin Shkreli, during which Vyera raise the price of Daraprim from $17.50 to $750 per tablet in 2015.
The order follows a January 2020 complaint against Shkreli, his associate Kevin Mulleady, their company Vyera Pharmaceuticals, LLC, and its parent company Phoenixus AG. Enforcers alleged that Shkreli (currently in prison for securities fraud) and Mulleady raised the price of Daraprim by 4000 percent and then created an elaborate web of restrictions to illegally block competitors from producing a cheaper option.
The complaint alleges that Shkreli and Mulleady started Vyera with a plan to purchase a life-saving drug, raise the price significantly, and use anticompetitive contracts to block competition. Vyera acquired Daraprim in 2015 and immediately raised the list price from $17.50 to $750 per tablet.
According to the complaint, after acquiring the drug and raising the list price, Vyera created a web of anticompetitive restrictions to box out the competition. Some of the anticompetitive actions included entering into resale-restriction agreements with distributors that prevented generic companies from procuring the drug for FDA-mandated testing; entering into exclusivity agreements with the suppliers of a critical input known as pyrimethamine API; and signing data-blocking agreements with two key distributors to prevent them from releasing Daraprim sales data, which masked the true size of the market opportunity for potential generic competitors.
