Turing's Public Record
Turing Pharmaceuticals told the public its 5,455% price increase on Daraprim would fund research, expand patient access, and keep a neglected drug on the market. Congressional testimony, court filings, and 400,000 pages of subpoenaed company documents contradicted those claims.
August 10, 2015: Daraprim Acquisition Announcement
What Turing said: Turing announced that it had acquired the US marketing rights to Daraprim from Impax Laboratories for about $55 million. It also disclosed $90 million in first-round financing. Impax CEO Fred Wilkinson called the deal "mutually beneficial."
What the record shows: The FTC later found that from its creation in fall 2014, Turing had been looking for "a sole-source drug with a small patient population that it could place into restricted distribution." Internal communications showed Martin Shkreli emailing the board after the deal: "Very good. Nice work as usual. $1bn here we come."
September 2015: Pricing Justification Statements
What Turing said: After the New York Times broke the story on September 20, 2015, Shkreli defended the new price on Bloomberg TV the next day: "Daraprim is still underpriced, relative to its peers." He told CBS News the drug "was unprofitable at the former price" and compared it to cancer drugs at "$100,000 or more."
The company made four claims: Daraprim was underpriced compared with oncology and rare disease therapies; profits would fund research into better toxoplasmosis treatments; patient assistance programmes would protect access; and 60% of net income would go to R&D.
Shkreli also told reporters: "I'm like Robin Hood... I'm taking Walmart's money and doing research for diseases no one cares about." He later said he regretted not raising the price higher.
The evidence: Turing had no formal study protocol for next-generation toxoplasmosis drugs. It funded no clinical trials and created no educational programmes. Former General Counsel Howard Dorfman testified under oath before the Senate Aging Committee that the price increase was "not justified by any such actual expenditure." Within months, congressional investigators had dismantled both the access and R&D claims.
November 24, 2015: Hospital Pricing Programme Announcement
What Turing said: In September, Shkreli promised to lower the price. Two months later, Turing announced a hospital pricing programme instead. Hospitals would receive discounts of up to 50% ($375 per pill). New 30-tablet bottles would reduce unit costs. The 340B federal drug discount programme would offer the drug at "as low as $1 per 100-pill bottle." Uninsured patients below 500% of the federal poverty level would receive Daraprim free through an expanded assistance programme.
The terms: Even with the 50% hospital discount, the price remained $375 per pill, 28 times the pre-acquisition cost. The 340B pricing applied only to qualifying safety-net providers, not to the broader market.
The patient assistance programme required enrolment through Walgreens Specialty Pharmacy, Turing's sole authorised distributor. Applicants had to provide extensive financial and health disclosures. Benefits were capped at $5,000 per month and $15,000 per year. Patients and providers reported spending hours on the application process. Some patients still faced copays of $16,830.
The R&D Investment Claim
What Turing said: Chief Commercial Officer Nancy Retzlaff testified before the House Oversight Committee on February 4, 2016, that "no patient needing Daraprim will ever be denied access." She said most patients did not pay the $750 list price. She also repeated the claim that 60% of net income was being reinvested in R&D.
Under cross-examination: Chairman Jason Chaffetz confronted Retzlaff with internal spending documents. Had the company spent money on fireworks? Yes. On an $800 cigar roller for a yacht event? Yes. Chaffetz told her: "Don't try to pretend and tell us that this $750 is justified, when you got a woman whose got AIDS."
Rep. Peter Welch of Vermont pressed her on the pricing structure, which set different prices for different categories of payers. He told Retzlaff: "So most people have no idea what the price is after you go through the gymnastics you just described."
Six weeks later, former General Counsel Howard Dorfman testified before the Senate committee that he and other management committee members had "repeatedly raised business objections" to the pricing plan. He added that Retzlaff had privately raised concerns about the increase in internal meetings while defending it in public and before Congress.
Federal Response
Federal agencies investigated the gap between Turing's public statements and its internal operations. The FTC filed an antitrust complaint in January 2020 alongside seven state attorneys general. The complaint alleged that Turing maintained its monopoly through restricted distribution that blocked generic manufacturers, exclusive supply agreements that locked up the raw ingredient, and data restrictions that hid sales figures from competitors.
The settlement, reached in December 2021, required the company (rebranded as Vyera Pharmaceuticals) to provide Daraprim at no more than $1 per tablet to certain buyers and to pay up to $40 million over 10 years. Shkreli personally owed $64.6 million and received a lifetime ban from the pharmaceutical industry.
Generic pyrimethamine became available in February 2020, five years after the practices cited by the FTC had blocked generic entry.
Pills sold fell from 25,500 in August 2015 to 600 in December 2015. Turing lost 97.6% of its sales volume within four months of the price increase.