OPKO Health, Inc.
In re OPKO Health, Inc. Derivative Action, Consolidated C.A. No. 2018-0740-SG (Del. Ch.)
On November 24, 2018, Chimicles Schwartz Kriner & Donaldson-Smith LLP (“CSK&D”) initiated an action asserting claims in the right of OPKO Health, Inc. (“OPKO”) against OPKO’s directors and certain officers for breach of fiduciary duties. Specifically, the Action alleges that the Company’s CEO and Chairman Phillip Frost breached his fiduciary duties as the controller of OPKO by using OPKO as his personal fiefdom to enrich himself through related party transactions approved by directors who are longtime friends and co-investors. The related party transactions included using OPKO funds to invest in other business where Frost had personally invested, in order to artificially prop up the value of those investments to enable Frost to cash-out at a profit.
On September 7, 2018, OPKO and Frost and Frost’s investment vehicle, Frost Gamma Investments Trust, were charged by the SEC with participating in pump and dump schemes at BioZone Pharmaceuticals, Inc. (now known as Cocrystal Pharma, Inc.) and MabVax Therapeutics Holdings, Inc. which were businesses controlled by Frost and two longtime Frost affiliates, Michael Brauser and Barry Honig. See SEC v. Honig, et al., No. 18-cv-8175 (S.D.N.Y.). Honig and Brauser are and/or were co-investors with Frost in BioZone and MabVax.
Prior to filing this Action, CSK&D obtained internal books and records of OPKO, through a demand pursuant to 8 Del. C. §220.
Attorneys for this case:
Robert J. Kriner, Jr.
Scott M. Tucker