Sian Capital made waves when it announced a 3% stake in diagnostics and pharmaceutical company Opko Health in October.
The activist investor, which has put at least $81 million into the Miami-based company, said Opko could be worth three times its current market cap of $2.7 billion, and asked for the firm to consider being taken private.
Now, with coronavirus cases spiking in the US and Europe, New York-based Sian is going after the company for allegedly dragging its feet on a potential COVID treatment that had its trials fast-tracked in June by the FDA.
On Friday, Sian, run by former Scoggins Capital executive Anish Monga, wrote a letter to Opko's board stating that there is an "urgent need for the company to act swiftly to distribute Rayaldee."
"As a substantial investor in Opko, we believe the Board has not only a fiduciary duty, but a humanitarian duty to distribute Rayaldee to those in need," Monga wrote. "There is no reason that so many Americans should continue dying without having the opportunity to access potential curative drugs."
The company did not respond to several requests for comment.
Rayaldee, with its active ingredient vitamin D prohormone Calcifediol, raises the body's vitamin D levels, and has been used before the pandemic to treat chronic kidney disease. The FDA fast-tracked the drug in June to do trials to see its effectiveness in helping people who have COVID after doctors noticed COVID patients with kidney issues responded well to the medication.
There's been extensive evidence increased vitamin D levels helps people recover from the virus, according to studies out of Europe. The United Kingdom has even pushed for its milk and bread to be fortified with vitamin D, which people normally get through sun exposure, and Scotland is providing free vitamin D supplements for citizens during the winter when people naturally stay inside more.
In Spain, a generic version of the drug was tested, and found that only 2% of those who received the drug after contracting COVID needed to be hospitalized compared to a placebo group in which 50% were forced to spend time in the hospital.
Monga said it was expected for Opko's trials to get started in late summer with possible distribution of Rayaldee in the fourth quarter, but at a Jefferies conference last week, the company said it was just now enrolling participants in the trial — prompting Monga to write his letter, and roll out a website on the drug's benefits with a template for people to email congressional leaders about the drug.
Of course, the activist investor believes the drug could greatly increase the company's bottom-line. With the current demand from European countries for a drug like this, Monga believes Opko could generate sales of more than $850 million this year even if sold at a 90% discount. Last year, the company sold $30 million-worth of the drug.
"This is a no-brainer," he said in an interview. "The shareholders of Opko are furious."
But the investor is also raising moral flags.
"It goes beyond profits at this point," Monga said. "You should have a drug that has gone through it studies by now."
Sian's letter ends in bold and underlined print reading "you have a humanitarian and fiduciary duty to" distribute the drug before quoting Barack Obama from a 2004 speech on the need for humanity to look out for each other.
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