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Firm once owned by 'pharma bro' to pay $40M in price-gouging settlement

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Firm once owned by 'pharma bro' to pay $40M in price-gouging settlement
Former Vyera Pharmaceuticals CEO Martin Shkreli is seen outside federal court during a fraud trial on August 3, 2017, in New York City. File Photo by Dennis Van Tine/UPI | License Photo

Dec. 8 (UPI) -- A company once owned by hedge fund manager Martin Shkreli, a young investor who became known as "pharma bro," has agreed to pay $40 million to settle charges that it ran up the cost for a potentially life-saving medication after acquiring the rights to it.

The Federal Trade Commission said Vyera Pharmaceuticals agreed to the deal to settle price-gouging charges.

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Under Shkreli, the company hiked the price of Daraprim in 2015 from $17.50 to $750 per tablet, an increase of 4,000%.

Shkreli, who faces antitrust charges for the scheme, was found to have created a "web of anti-competitive restrictions" meant to delay the production of generic versions of the drug. His trial is set to begin on Dec. 14.

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Under the settlement, Vyera and Phoenixus are required to pay $10 million immediately and $30 million over ten years. File Photo by John Angelillo/UPI

In 2018, Shkreli was sentenced to seven years in prison on federal charges of wire and securities fraud. He was banned from any role in the pharmaceutical industry for seven years.

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Tuesday's order in New York, California, Illinois, North Carolina, Ohio, Pennsylvania and Virginia names Shkreli, associate Kevin Mulleady, Vyera Pharmaceuticals and parent company Phoenixus AG.

Mulleady will be banned from the drug industry and subject to a fine of $250,000 if he violates the order.

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Under the settlement, Vyera and Phoenixus are required to pay $10 million immediately and $30 million over ten years. They also must make Daraprim available to any generic competitor at list price.

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