3 October 12 15:49–Biotech billionaire Prof. Shlomo Ben-Haim is facing his third lawsuit this year and fourth in his career over the life sciences companies he founded. He has been sued twice by entrepreneurs of companies he founded, who accused him of stealing their assets. He was once sued by his former partner and friend, Lewis Pell for alleged unfair distribution of assets between them. The question arises whether the string of lawsuits is because of Ben-Haim’s deep pockets, or is he a serial dispossessor?
Ben-Haim is considered one of the most prominent and successful investors in Israel’s life sciences industry. He started out as a cardiologist at Rambam Medical Center in Haifa, and was considered a genius as a doctor and as an engineer. Pell, the US life sciences investor who began his Israeli activities at the time, met Ben-Haim and they began to work together, and it turned out that Ben-Haim also had a talent for business and investments.
Pell and Ben-Haim jointly founded several medical devices companies, which they sold for over $1 billion. The biggest success was Biosense Webster, in which Ben-Haim was also involved as an inventor, which was sold to Johnson & Johnson for $427 million in 1997. The company is still operating in Haifa, and market sources estimate its annual revenue at $500 million.
Other exits include Disc-O-Tech, which was acquired in 2006 for $220 million by Kyphon; Instent, acquired in 1996 for $200 million by Medtronic Inc. (NYSE: MDT); Impulse Dynamics, acquired in 2000 for $127 million by Guidant; X-Technologies, acquired in 2003 for $60 million by Guidant; and Odigo, acquired in 2002 by Comverse Technology Inc. (Nasdaq: CMVT) for $17 million.
The pace of exits has slowed in recent years, as the situation of medical devices companies has become more complicated, although deals are still made. In 2011, Radiancy, in which Ben-Haim was a shareholder, merged with PhotoMedex Inc. (Nasdaq: PHMD; TASE: PHMD) in a $174 million deal that gave Radiancy shareholders 75% of the merged company, which has a market cap of $300 million.
He acts like a gangster
Ben-Haim has also become the focus of lawsuits. The first lawsuit was filed by Radiancy’s founders in 2004. They alleged that he and Pell tried to dispossess them of their share of the company, using thuggish methods that included false accusations of sexual harassment. The lawsuit was ultimately settled.
A similar lawsuit was filed by the founders of RF Dynamics, who also accused Ben-Haim of acting like a gangster in his work relations with them, including sending notices to employees which said that the petitioners were thieves, which was why they were removed from their posts. At the time, sources close to Ben-Haim and the company said that no such remarks were ever made, and that the company’s founders did not invent its technology, but were merely employees…Read More>>