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Tuesday, October 27, 2015

Daraprim Saga: 25 cent drug in #Nigeria is $750 as Controversial biotech CEO @MartinShkreli just lost money on his 'bad idea' #HNNHealth

Marin Shkreli via Twitter
Draprim a drug worth 25 cents in Nigeria is $750 in America. Shit happens. Shkreli has lost money. Hope he knows that the drug could be hoarded from here by others. SMH

Former hedge fund manager and biotech CEO Martin Shkreli has ditched his money-losing long position in Canadian pharmaceutical company Valeant three days after boasting about it on Twitter.
"Exited the Allergan/Valeant trade. 3% loss or so. Bad idea. Onward and upward,"Shkreli tweeted Monday.

On Wednesday, Valeant's stock tanked after short-selling firm Citron Research published a report asking if it was operating an Enron-like fraud.

That same day, Shkreli posted on Twitter that he was long Valeant and short Allergan.

"I have taken a long position in [Valeant] and shorted [Allergan] as a hedge. Both companies have similar prospects and one is at half the price," Shkreli tweeted.

Valeant has said that they "categorically deny the allegations made in the Citron Report."

The company hosted an all-hands call Monday morning to address the allegations. The stock was last trading down 3.3% at about $112.27 per share.

The stock is down about 23% since the Citron report came out.

Meanwhile, Allergan's stock has risen about 2.7% since last Wednesday.

Shkreli is the founder of Turing Pharmaceuticals, a biotech startup. He quickly became a household name last month after his company purchased the rights to a 62-year-old antiparasitic drug and then jacked up the price by more than 5,000%.

Valeant has also been criticized for its drug pricing. The company has also been compared to Shkreli.

In late September, Democrats on the US House of Representatives' Oversight and Government Reform Committee sent a letter to the committee's chairman, Rep. Jason Chaffetz (R-Utah). They asked him to subpoena Valeant for documents related to price increases of acquired drugs.

The letter said that Valeant "is using precisely the same business model as Martin Shkreli, the 32-year-old former hedge fund manager whose company recently purchased the life-saving drug Daraprim and increased the price from $13.50 to $750 per pill 'overnight.'"

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