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Court rejects ‘Pharma Bro’ Shkreli’s motion to dismiss multi-state lawsuit

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FILE- In this Aug. 15, 2017 file photo, former pharmaceutical CEO Martin Shkreli speaks during an interview by Maria Bartiromo during her “Mornings with Maria Bartiromo” program on the Fox Business Network, in New York. The imprisoned pharmaceutical entrepreneur, who is serving prison time for fraud, has filed a fraud lawsuit against one of his former investors. (AP Photo/Richard Drew, File)

NEW YORK (WTEN) — District Judge Denise Cote on Tuesday denied the motion to dismiss a lawsuit brought against Vyera Pharmaceuticals—formerly Turing Pharmaceuticals—and its ex-CEOs. One ex-CEO is high-profile federal inmate Martin Skreli, who rose to national prominence as the price-gouging “Pharma Bro.”

Cote rejected the motion to dismiss the suit—filed by the Federal Trade Commission and attorneys general representing New York, California, Ohio, Pennsylvania, Illinois, North Carolina, and Virginia—on Tuesday.

The office of New York’s Attorney General Letitia James alleges that Vyera/Turing and Shkreli—along with business partner Kevin Mulleady—stifled competition and set outrageous prices for a drug that treats toxoplasmosis. James says that, despite being the sole source of the potentially life-saving treatment, the defendants raised the price by 4,000% or more overnight, from $17.50 to $750 per tablet.

The motion to dismiss seemed to hinge on the defendants’ conclusion that the FTC did not have sufficient standing or jurisdiction to sue, a conclusion that Cote’s written opinion rejects. “As already explained, the alleged scheme continues,” Cote writes. Check out the document below:

The FTC and the Office of the New York State Attorney General sued in January, with the six other states joining the lawsuit in April. The defendants filed their motion to dismiss in late May.

Shkreli was arrested in December 2015 for securities fraud, and incarcerated in 2017. Court documents show that his status and role with the company grant him significant influence over its operations, even from his cell.

On Wednesday, Letitia James appeared alongside Pennsylvania Attorney General Josh Shapiro and Massachusetts Attorney General Maura Healey as part of the Democratic National Convention.

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