He lied about the current status of the fund for quite a while as he attempted to replace the money, and sent fraudulent reports showing good returns when all the money was lost. He later replaced all the lost funds with profits from the company he founded (and reportedly worked hard to make profitable).

I'm not sure whether that company was the one responsible for the drug price hike, and whether that constituted a lot of the profits or that actually went back into research as I believe he said it did during that episode.