- Federal prosecutors on Wednesday called notorious pharmaceutical industry fraudster Martin Shkreli "delusional" and greedy as they opposed his bid to win early release from prison.
- Shkreli is asking a judge to release him into home confinement both so he can avoid catching the coronavirus and to work on a potential cure for it.
- Prosecutors said there is strong evidence that Shkreli lacks the scientific skills needed to develop a possible Covid-19 treatment if he were to be sprung to serve the remaining 40 months or so of his seven-year prison sentence.
Federal prosecutors on Wednesday called notorious pharmaceutical industry fraudster Martin Shkreli "delusional" and greedy as they opposed his bid to win early release from prison to both avoid catching the coronavirus — and to work on a potential cure for it.
And they warned that there is good reason to believe that "Shkreli cannot be trusted" to comply with conditions imposed on him if he were to be released — including ones designed to prevent him from taking advantage of the coronovirus pandemic to commit more fraud.
Those prosecutors poured scorn on Shkreli in a court filing that questioned whether he even has the scientific skills needed to develop a possible Covid-19 treatment if he were to be sprung to serve the remaining 40 months or so of his seven-year prison sentence.
Prosecutors cited a report on Shkreli filed this week by U.S. Probation officials.
"As Probation observed, Shkreli's 'belief that he can develop a cure for COVID-19, something that has so far eluded the best medical and scientific minds in the world working around the clock, is not only a practice in wild and completely unfounded speculation, but is indicative of the same kind of delusional self-aggrandizing behavior that underlies the defendant's conduct in the commission of the'" crimes that landed him in prison, prosecutors wrote.
And prosecutors scoffed at the idea that the 37-year-old was motivated by altruism, as opposed to lust for more money, in his desire to be free to pursue that work.
"Even if Shkreli were somehow able to develop a potential cure, there is no evidence that he would in fact use it to 'contribute to the betterment of society,' as he claims rather than to enrich himself to the maximum extent possible," prosecutors wrote, citing the Probation report, in their filing in U.S. District Court in Brooklyn, New York.
They said that if Shkreli developed a cure, there was a risk of him "concealing his work or declining to provide such a cure to others unless he were paid an exorbitant sum."
"As the evidence at trial demonstrated, Shkreli's involvement in the search for cures to diseases was primarily motivated by the potential to make tremendous profits," wrote Assistant U.S. Attorneys Jacquelyn Kasulis and Alixandra Smith, who prosecuted him at his 2017 trial.
Prosecutors noted the fact that Shkreli had raised the price of the parasitic infection drug Daraprim by more than 5,000% in 2015, an act that won him national infamy.
The filing came in response to a request by Shkreli last week to Judge Kiyo Matsumoto to grant him "compassionate release" to allow him to serve the remaining time of his sentence for securities fraud in home confinement with his unidentified fiance in Manhattan.
Shkreli's lawyer, Benjamin Brafman, when asked for comment about the prosecutors' new filing, wrote in an email, 'Was hoping for a more compassionate response." Brafman noted that he has "often said that left alone in a lab, he could find a cure for cancer."
Three "months in a lab under strict conditions to try and find a cure for Covid 19, seems like a no brainer," the lawyer added.
Brafman and other lawyers said in their filing last week that Shkreli, now locked up in a low-security federal prison in Pennsylvania, has a "susceptibility to infection [from the coronavirus] due to allergies and asthma."
Defense lawyers said that Shkreli "has been conducting significant research into developing molecules to inhibit the coronavirus RdRP protein and he would continue to do so if released," the court filing said.
Shkreli, "since learning of this fatal disease" has spent "countless hours" researching possible treatments, according to the filing. "One company is prepared to begin working on clinical trials of Mr. Shkreli's work within weeks," defense lawyers wrote.
But federal prosecutors in their own filing said that Matsumoto should not even consider Shkreli's request now because he has not exhausted his administrative remedies to the federal Bureau of Prisons' denial of his application for early release. Shkreli's appeal of that denial is still pending.
Prosecutors also said Shkreli is healthy, with no documented underlying medical conditions, and is in a facility that has no cases of the coronavirus among either inmates or staff.
Their filing said Shkreli's own request last week belies the need to release him so that he can continue his research into a coronavirus treatment.
Even if Matsumoto is willing to consider his bid for release, prosecutors wrote that "he offers no authority for the Court to conclude that such an alleged plan is a basis for release, or how it distinguishes him from any other defendant who claims that society would be better off if he were released because he will purportedly devote himself to its betterment."
"Shkreli has no formal scientific training and no experience working [in] a laboratory setting, and he does not explain why he cannot continue to develop and discuss any ideas he may have about COVID-19 from prison, as he has," prosecutors wrote.
And prosecutors noted his lack of shame in raising the price of Daraprim, which is often used to treat pregnant women, babies and people with HIV, from $13.50 per pill to $750 per pill.
"In December 2015, at the Forbes Healthcare Summit, Shkreli was asked about whether he would have done anything differently in relation to the Daraprim drug increase after he received significant negative publicity, and he replied, 'I probably would have raised the price higher is probably what I would have done.'"
"There is no evidence that Shkreli has changed in this, or any other, respect," prosecutors wrote.
Prosecutors, citing the Probation report, said that Shkreli "has committed several disciplinary violations" since being locked up after his conviction in mid-2017.
Those violations include being absent from an assignment in prison, refusing a work or program assignment, sending mail to another inmate via a third party without authorization, and soliciting funds via mail and a phone call that was funneled to another inmate, according to prosecutors.
"Shkreli continues to believe that the rules do not apply to him," prosecutors wrote.
"Reducing Shkreli's sentence to less than half of what he was sentenced to serve would not in any event be warranted, but is particularly inappropriate light of this misconduct."
And, prosecutors warned that "this misconduct strongly suggests that Shkreli cannot be trusted to follow any conditions of supervised release, including any that might be imposed to mitigate the risk of him not taking advantage of the COVID-19 pandemic to commit additional fraud."
Shkreli was convicted at trial in Brooklyn federal court of securities fraud and conspiracy.
Prosecutors during the case introduced evidence that he had repeatedly lied to investors about the financial performance of two hedge funds that he ran, and then used money invested in those funds, without the knowledge of his investors, to help start his first pharmaceuticals company, Retrophin.
Shkreli's efforts to overturn his conviction on appeal have been exhausted.