Turing Pharmaceuticals Inc. is close to replacing Martin Shkreli as CEO after he was arrested by the FBI Thursday on charges of securities fraud.
Sources familiar with the case say that Shkreli is planning to step down as CEO, however it hasn't been decided whether the new CEO will only serve in an interim capacity or be a permanent replacement, according to Reuters.
Shkreli, who pleaded not guilty in Brooklyn, N.Y., federal court on Thursday to seven counts of securities fraud and conspiracy, was arrested following accusations that he tricked MSMB Capital Management investors and used money from Retrophin in order to cover personal debts, according to CNBC.
Shkreli is free for the time being after posting a $5 million bond, though he can't contact MSMB or Retrophin employees and is unable to leave New York. His next court date is set for Jan. 20.
In the meantime, prosecutors are investigating the circumstances surrounding Shkreli's November purchase of 70 percent of biotechnology firm KaloBios Pharmaceuticals and his resulting rise to CEO, reported The Wall Street Journal. A few days before the acquisition, the company announced it was shutting down since it had run out of money and its products had failed clinical trials.