LowEndBox - Cheap VPS, Hosting and Dedicated Server Deals

LowEndBox Won't Be Posting Martin Shkreli's Offers

Martin ShkreliMartin Shkreli has been released from prison.

You may remember him as “pharma bro”, who made a killing by exploiting an interesting aspect of the pharmaceutical market.  He realized that there are several categories of pills that have the following characteristics:

  1. Their patients require them to live.
  2. The market is significant but relatively small.  This is important for the next point.
  3. There is no generic.  (Generic drugs typically require a lot of time and effort to get regulatory approval).

There are many such medications.  For example, Daraprim is used to treat toxoplasmosis in AIDS patients (and others).  The patent was long-expired, but the market was so small that no one would step in and go through all the regulatory work and expense to make a generic.  For these kinds of medicines, there is a small profit in making the drugs but they’re not blockbusters who are significant to the bottom line.

Until Shkreli came along.  What he did was buy the rights to Daraprim, and then jack up the price.  By 5600%.  Pricing on the drug went from $13.50 per pill to $750 per pill overnight.

This worked because the normal merciful forces of capitalism were constrained by the government.  In any normal market, if someone had bought something without any patent protection and raised the prices by 5600%, competitors would flood in and restore price equilibrium almost immediately.  However, the generic approval process kept competitors out.

If this was a new tennis shoe, no one would care.  But it’s a life-saving medication, and so you essentially have a market where people must buy no matter what you charge.

Shkreli’s pharma price play wouldn’t have lasted forever, because other pharmaceutical companies stepped in and said “this is so appalling, we’re going to take him out” and within four months a company announced it would be making a generic for $1/pill.

In the meantime Shkreli went to prison for securities fraud.  In one of his previous ventures, he was essentially running a Ponzi scheme, raising capital from new investors and using it to pay great returns to his older investors.

And now he’s out.

And getting into high tech, apparently.  Here’s one description of the new scheme: “the creation of a blockchain-based Web3 drug discovery platform that traffics in his own cryptocurrency, MSI, aka Martin Shkreli Inu.”

There is a white paper but it’s a bunch of buzzwords.  The idea is sort of Folding@Home – your computer will crunch assignments to help discover drugs, and there’s crypto, and you get paid in a currency Martin made up.

What could go wrong?  We must be on the precipice of a bold new era of drug discoveries and medical breakthroughs.  Surely this isn’t a scheme to defraud people through complex but inspiring claims, is it?

Martin doesn’t pass our basic fraud checks.  Sorry, bro, no LEB offers for you.

2 Comments

  1. AlexDonbasz:

    >“this is so appalling, we’re going to take him out”
    He was always a slimy bastard, but this is not right. There aren’t any heroes in that story. The rich people that went after him only did so because they lost money. The media banked on the sensationalism of selling him as A grade asshole in order to paint a worse picture of him for their powerful and then pissed friends.
    If pharmaceutical companies had any morals the Sacklers wouldn’t exist, nor would get as far as they did. Price hikes are as common as always. Insulin price is a fucking disgrace, and many other meds.
    Shkreli is an absolute bastard, but he only got taken down because a few powerful people got the short stick on their gambling.

    August 27, 2022 @ 7:29 pm | Reply
  2. J Conner:

    “LowEndBox Won’t Be Posting Martin Shkreli’s Offers”

    You just did with this article.

    August 30, 2022 @ 8:28 am | Reply

Leave a Reply

Some notes on commenting on LowEndBox:

  • Do not use LowEndBox for support issues. Go to your hosting provider and issue a ticket there. Coming here saying "my VPS is down, what do I do?!" will only have your comments removed.
  • Akismet is used for spam detection. Some comments may be held temporarily for manual approval.
  • Use <pre>...</pre> to quote the output from your terminal/console, or consider using a pastebin service.

Your email address will not be published.