- The legacy of disgraced pharmaceutical executive Martin Shkreli took another turn Thursday, with the disclosure a neuroscience drug he helped invent and initially develop failed in late-stage testing.
- The announcement, from San Diego-based biotech Retrophin, comes as Shkreli serves a seven-year prison sentence for securities fraud. Retrophin said the drug, called fosmetpantotenate, failed to beat out placebo in clinical study of patients with a rare nervous system disorder called pantothenate kinase-associated neurodegeneration.
- Shkreli is listed as one of three inventors for several patents related to the drug, which now appears to have reached an end. "I think at this point we don't have any plans for further investigation," Retrophin CEO Eric Dube said on a Thursday call with analysts. The company's stock fell nearly 30% at market open.
Fosmetpantotenate was the leading drug in Retrophin's pipeline, but the company is now switching attention to its next compound instead. That drug, sparsentan, is in two pivotal Phase 3 programs for two rare kidney diseases.
The failure of Shkreli's drug is a disappointment but not a huge surprise, SVB Leerink analyst Joseph Schwartz wrote in a Thursday note to investors. To date, there are no approved drugs to treat the rare CNS condition.
Retrophin did not disclose any statistical results from the study, which Dube said would be presented at an upcoming scientific meeting. According to the CEO, fosmetpantotenate also didn't deliver any better results than placebo among various sub-groups studied.
Shkreli founded Retrophin in 2011 and served as CEO until October 2014, when the board ousted him after conducting an investigation into alleged misappropriation of funds.
In August 2017, the former industry exec was convicted on securities fraud charges tied to his time leading a fund called MSMB Capital Management, which had invested in Retrophin.
Last month, a federal appeals court upheld that conviction and seven-year sentence, which he is serving in a Fort Dix, New Jersey prison cell, according to The Wall Street Journal.
Even confined to prison, Shkreli has stayed in the headlines. Earlier this year, The Wall Street Journal reported that he was running one of his former drug companies, Phoenixus AG, from his prison cell with a contraband smartphone. The U.S. Bureau of Prisons is now investigating that report.