Schadenfreude, thy name is Martin Shkreli. Few arrests this year can have been greeted with as much jubilation as that of the one-time Manhattan hedge fund manager. Not in outrage at the actual charges of securities and wire fraud – but because the cuffing was seen as payback for Mr Shkreli’s unrelated practice of buying old life-saving drugs then jacking up the price to eyewatering levels. Take Daraprim, a 62-year-old cure for a life-threatening parasitic infection – bought in August by Mr Shkreli, who then hiked the price overnight from $13.50 a tablet (just over £9) to $750 (a little over £506). That move united the Democrat presidential rivals Bernie Sanders and Hilary Clinton – not to mention medical professionals and much of the public – in dismay and condemnation. Mr Shkreli goes so far as to blame that furore for his arrest– which is a convenient position for any defendant to adopt.
What was it about that story that turned so many stomachs? One aspect must have been the sheer parasitism of the business model. As a doctor at the Icahn School of Medicine at Mount Sinai asked plaintively, “What is it that they are doing differently that has led to this dramatic increase?” The answer, of course, was: nothing. For many, this broke a fundamental rule of capitalism – that reward should be commensurate with risk.
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