Price-gouging drug executive Shkreli calls lawmakers ‘imbeciles’

Former drug executive Martin Shkreli smirked and brushed off questions about drug prices then tweeted that lawmakers were imbeciles on Thursday, when he appeared at a US congressional hearing against his will.

Shkreli testifying before the House Committee on Oversight and Government Reform, 2016

In the days leading up to his big meeting with Congress, couldn't wait to, as he put it, "school Congress."

"I would love to talk to Congress. I would berate them. I would insult them," said the former chief executive of Turing Pharmaceuticals, who became America's most-hated man in September when it was revealed his company bought a potentially life-saving drug and jacked up the price of it by more than 5,000 per cent.

Shkreli sparked outrage among patients, medical societies and Democratic presidential front-runner Hillary Clinton after Turing Pharmaceuticals raised the price of Daraprim by more than 5,000 per cent to $750 a pill (See: Turing vows to cut Daraprim drug price after furore over 5,000% hike). 

The lifesaving medicine, used to treat a parasitic infection, once sold for $1 a pill and has been on the market for more than 60 years.

Shkreli is now under investigation for securities fraud unrelated to the price-gouging, but that hasn't stopped the 32-year-old from tweeting, live-streaming from his New York City apartment, and baiting Congress in media interviews. Lawmakers were no doubt just as eager to school him and be seen telling him what's what in a public forum.

At a hearing of the US House Committee on Oversight and Government Reform, Shkreli repeatedly invoked the Fifth Amendment of the US Constitution, which says no person shall be compelled in any criminal case "to be a witness against himself".

Wearing a sport jacket and collared shirt rather than his usual T-shirt, he responded to questions by laughing, twirling a pencil and yawning.

Committee chairman Jason Chaffetz, a Utah Republican, asked Shkreli what he would tell a single, pregnant woman with AIDS who needed Daraprim to survive, and whether he thought he had done anything wrong. Shkreli declined to answer.

"I intend to follow the advice of my counsel, not yours," said Shkreli after South Carolina Republican Representative Trey Gowdy suggested he could answer questions that were unrelated to pending fraud charges against him.

After the hearing, Shkreli's lawyer, Benjamin Brafman, attributed his client's behaviour to "nervous energy."

Later, though, Shkreli wrote on Twitter, "Hard to accept that these imbeciles represent the people in our government."

US Representative Elijah Cummings, who learned about the tweet while Turing chief commercial officer Nancy Retzlaff was testifying, pounded his fist on the dais. The Maryland Democrat then shouted about an internal Turing document in which a staffer joked about the price increase.

 "You all spent all of your time strategizing about how to hide your price increase ... and coming up with stupid jokes while other people were sitting there trying to figure out how they were going to survive," Cummings said.

Shkreli was arrested in December and charged with running his investment funds and companies almost like a Ponzi scheme. He has pleaded not guilty to the fraud charges, which are not related to the pricing of Daraprim. He also stepped down from Turing and was fired from KaloBios Pharmaceuticals Inc.

Cummings pleaded with Shkreli to reconsider his views about drug pricing, "You can go down as the poster boy for greedy drug company executives, or you can change the system."

At one point, Brafman asked to address the committee, but Chaffetz said no.

Shkreli was even asked about his purchase of a limited-edition Wu-Tang Clan hip-hop album for $2 million.

"Is that the name of the album? The name of the group?" Gowdy asked. After Shkreli again invoked the Fifth Amendment, Gowdy added, "I am stunned that a conversation about an album he purchased could possibly subject him to incrimination."

Shkreli was allowed to leave early after he repeated he would not answer questions.

Contempt
Representative John Mica, a Florida Republican, said he would consider asking fellow lawmakers to hold Shkreli in contempt for his behaviour.

"I don't think I've ever seen the committee treated with such contempt," Mica said.

Brafman said Shkreli would have liked to discuss drug pricing but had no choice, given the criminal charges against him.

Shkreli's tweet did not amount to waiving his right against self-incrimination, experts said. "The First Amendment protects Shkreli's right to post his opinion on Twitter that the Congress is populated by 'imbeciles'. This is classic political free speech," said lawyer Paul Callan.

Also at the hearing, Valeant Pharmaceuticals Inc interim CEO Howard Schiller put forward a conciliatory face, testifying that his company had changed its business and pricing tactics.

"Where we have made mistakes, we are listening and changing," Schiller said during opening remarks. "In a number of cases, we have been too aggressive" about price increases.

Valeant shares rose more than 5 per cent during the hearing.

Retzlaff testified that Turing acquired Daraprim because it was "priced far below its market value" and is committed to investing revenue into new treatments.

The Federal Trade Commission and the New York attorney general are investigating Turing for possible antitrust violations.