Martin Shkreli Pleads Not Guilty to New Conspiracy Charge

Former pharmaceutical executive Martin Shkreli pleaded not guilty Monday to a new conspiracy charge filed by Brooklyn federal prosecutors.

Last week, prosecutors added an eighth criminal count against Mr. Shkreli, who was arrested last December and accused of plotting with his former lawyer to defraud pharmaceutical company Retrophin Inc., in an attempt to cover losses suffered by investors in Mr. Shkreli’s hedge funds. At the time, Mr. Shkreli was the chief executive at Retrophin.

Evan Greebel, Mr. Shkreli’s former lawyer, also pleaded not guilty on Monday to the new securities fraud conspiracy charge, which alleges Mr. Shkreli failed to disclose his ownership of certain Retrophin shares to the Securities and Exchange Commission. Mr. Greebel was Retrophin’s outside counsel at the time.

As part of the new charge, prosecutors said Mr. Shkreli hid his control of certain unrestricted or free trading shares of Retrophin by dividing the shares among seven employees and contractors to avoid the 5% ownership threshold that would trigger reporting to the SEC. Mr. Shkreli allegedly directed the employees to transfer portions of their Retrophin shares to help pay off his debts.

The criminal charges against Mr. Shkreli are unrelated to Mr. Shkreli’s time as chief executive of Turing Pharmaceuticals AG, when he became notorious for raising by more than 50-fold the price of a drug that treats a potentially deadly parasitic infection.

Benjamin Brafman, a lawyer for Mr. Shkreli, said in a statement on the new charge: “There is nothing in the new indictment that impacts in any way on the flawed theory of the case as applied to Mr. Shkreli.”

Reed Brodsky, a lawyer for Mr. Greebel, declined to comment on the new charge.

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