CEO Who Raised Price of Life-Saving Drug 5,000 Percent Arrested for Securities Fraud

The charges against Shkreli are not related to his decision to raise the price of the drug

Photo: Craig Ruttle/AP

Martin Shkreli, the biotech entrepreneur who drew criticism after increasing a life-saving drug’s price by 5,000 percent earlier this year, has been arrested on charges of securities fraud and conspiracy, PEOPLE has confirmed.

Federal officials arrested the 32-year-old on Thursday in New York, an FBI official tells PEOPLE.

A seven-count indictment alleges that Shkreli and others carried out three fraud schemes from 2009 to 2014, the Associated Press reports.

They are accused of misleading investors and illegally using assets from Retrophin, a biotech company he once ran, to pay off debts, CNBC and Reuters report.

The arrest is not related to the infamous price-hike earlier this year, the New York Times reports.

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Shkreli started Retrophin in 2011, and left in 2014 amidst allegations of unethical conduct between his dealings with Retrophin and the hedge fund, Forbes reported.

Retrophin officials sued Shkreli for $65 million earlier this year, claiming he stole money from the company in order to pay off debts involving the hedge fund.

Shkreli was arrested at the Murray Hill Tower Apartments in Manhattan Thursday morning, according to Reuters.

As CEO of Turing Pharmaceuticals, Shkreli increased the price of Daraprim, the only FDA approved treatment for a rare parasitic infection called toxoplasmosis that strikes pregnant women, cancer patients and AIDS patients, from $13.50 to $750 a pill.

The 5,000 percent increase sparked backlash, prompting a vow from Shkreli to lower the price of the drug. He told ABC in October: “We’ve agreed to lower the price of Daraprim to a point that is more affordable and is able to allow the company to make a profit, but a very small profit.”

However, the company reneged from its pledge and instead has reduced what it charges hospitals for the drug. The bulk of the hefty tab is covered by insurance companies, the Associated Press reports.

Shkreli also made news when he was revealed as the mystery buyer of the only known copy of a Wu-Tang clan album, The New York Times reports.

Turing did not immediately respond to a request for comment from PEOPLE.