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Sorrento (SRNE) Misconduct Case
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- Sorrento (SRNE) commenced Chapter 11 proceedings.
- SRNE's stock dropped by 72.6% and lost $374M of market cap, seriously damaging Investors.
- Investors suspect the Company & its Leaders of breach of fiduciary duties.
On February 13, 2023, Sorrento Therapeutics (NASDAQ: SRNE) released an 8-K filing with the SEC stating that the Company, and its wholly-owned subsidiary Scintilla Pharmaceuticals, have voluntarily commenced a Chapter 11 bankruptcy proceeding in the U.S. Bankruptcy Court for the Southern District of Texas.
- Investing community links SRNE's Chapter 11 filing to the Company's pending litigation about the 2015 JV known as NANTibody with billionaire biotech investor Dr. Patrick Soon-Shiong and the related entities.
- In December 2022, an arbitrator issued an award granting contractual damages and pre-award interest in the amount of $156.8M to Soon-Shiong's company NantCell, a subsidiary of ImmunityBio. Additionally, the court awarded NANTibody $16.7M.
- On February 7, 2023, the court confirmed the judgment that put Sorrento (SRNE) and the affiliates at risk of asset seizure but the bankruptcy filing could postpone any potential asset seizures.
Even though the radical step of the Company could have been dictated by the assets protection and the operational activities preservation, nevertheless, these actions became a surprise for Investors and the market and led to significant losses for shareholders, which gives the latter reason to suspect that the Company and its Leaders have breached their fiduciary duties.
Breach of Fiduciary duty,
Shock Event Date
13 February 2023