Martin Shkreli was sentenced last week. This is the 34-year-old guy from Brooklyn who decided to raise the price of Daraprim, a drug some people need to stay alive, from $13.50 a pill to $750 a pill. Although this earned him the title of “Most Hated Man in America,” it turned out he could legally do this.
Indeed, today, anybody can legally do this if they can find a pill people need, nobody can compete with and there is no substitute for. You just set the price at whatever you want. This is America. This is capitalism. Thank you, Martin Shkreli.
However, in much the same way that O.J. Simpson served no time for what most people believe was the gruesome murder of his wife but wound up in jail for years for a lesser charge, Shkreli was charged and found guilty of a lesser charge.
The charge was securities fraud. Among other things, Shkreli gave false information to people investing in his company. That’s illegal. Prosecutors had pushed for 15 years. But the judge sentenced him to seven years, which means with good behavior he might be out in four.
So if he hasn’t learned anything, he can go right back to doing these terrible-but-legal things to people. He has to pay $7.36 million in forfeiture. His net worth is estimated at $27.2 million.
If he can’t pay the $7.36 million, the court has the opportunity to cherry pick his holdings. And this makes for an interesting story.
Shkreli has $5 million in cash in one bank account. He has company stock. He has art worth about $500,000 and then he has this record album, for which some sources say he paid $2 million.
The album is special. The group is the Wu-Tang Clan, the album is Once Upon a Time in Shaolin, and they made it in 2014. They made one physical copy with a sleeve made and designed in silver and bronze. The idea was, that in a digital age, with the price of music going down, this single album would be a work of art. That’s the one Shkreli reportedly bought for $2 million.
This story now moves from the value of a pill to the value of art. If the government seizes the record, will it sell for the $2 million they expect? Original albums by others no longer in print can sometimes fetch $15,000. But this $2 million, if that’s what it was, did not include the music rights, which could have added to its value. It also has been played—Shkreli played snippets of different parts of it online—so it’s used.
At one point, Shkreli put the album up for bid on eBay, and it was bid up to $1 million, half of what it appears he bought it for. He didn’t consummate the sale.
So how much for this pill? How much for this record album? Martin Shkreli will be out of jail soon. He could tell us.