San Francisco: The University of California at Davis and Moffitt Cancer Centre in Florida have suspended a planned drug trial sponsored by KaloBios Pharmaceuticals Inc following the arrest of Chief Executive Officer Martin Shkreli on securities fraud charges.
Moffitt has suspended the clinical trial, which was to have been funded by KaloBios, indefinitely “pending the outcome of the investigation of KaloBios’ CEO,” the center’s spokeswoman Patricia Kim said Saturday in an email. UC Davis said its suspension will remain in effect “pending further analysis,” according to an email from spokeswoman Dorsey Griffith. The drug being tested, known as KB003, was developed to treat a form of leukaemia.
Shkreli, 32, was arrested Thursday morning in New York on securities fraud charges related to one of his previous companies, Retrophin Inc. KaloBios shares plunged 53 per cent on Friday before trading was halted. Shkreli is best known for raising the price of a decades-old drug acquired by Turing Pharmaceuticals AG to $750 a pill from $13.50. He resigned as CEO of Turing on Friday.
Last month, Shkreli bought a majority interest in KaloBios and named himself CEO. The company’s stock was trading at less than $1 before he made the move, and it subsequently rose to as high as $39.50, giving the company a market value of more than $100 million (Dh367 million).
Paying off debts
Prosecutors have charged Shkreli with illegally taking stock from Retrophin, a biotechnology firm he started in 2011, and using it to pay off debts from unrelated business dealings. He was later ousted from the company, where he’d been CEO, and sued by its board. Shkreli has previously denied any wrongdoing related to the matter.
Shkreli added a tweet to the top of his Twitter feed Saturday saying that he was confident he would prevail.
“The allegations against me are baseless and without merit,” Shkreli wrote to his almost 35,000 Twitter followers. That sat above a retweet he had posted of a Vanity Fair profile from a day earlier, and a link to a Dec. 17 statement that also said Shkreli expected to be “fully vindicated.”
Several other institutions were scheduled to participate in the trial. The Mayo Clinic declined to comment. The Cleveland Clinic and the University of Miami’s Sylvester Cancer Centre said they’re studying the situation and deciding whether to continue. Weill Cornell Medical College and Northwestern University’s Lurie Comprehensive Cancer Center had no immediate comment or didn’t return a call seeking comment.