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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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75-2402409
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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4400 Biscayne Blvd., Miami, FL 33137
(Address of Principal Executive Offices) (Zip Code) |
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(Registrant’s Telephone Number, Including Area Code): (305) 575-4100
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Securities registered pursuant to section 12(b) of the Act:
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, $.01 par value per share
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New York Stock Exchange
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(in Rule 12b-2 of the Exchange Act) (Check one):
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
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Page
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Part I.
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Part II.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Part III.
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Item 10.
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Directors, Executive Officers and Corporate Governance
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Item 11.
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Executive Compensation
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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Item 13.
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Certain Relationships and Related Transactions and Director Independence
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Item 14.
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Principal Accounting Fees and Services
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Part IV.
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Item 15.
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Signatures
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Certifications
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EX-21
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EX-23.1
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EX-31.1
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EX-31.2
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EX-32.1
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EX-32.2
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EX-101. INS XBRL Instance Document
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EX-101.SCH XBRL Taxonomy Extension Schema Document
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EX-101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
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EX-101.DEF XBRL Taxonomy Extension Definition Linkbase Document
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EX-101.LAB XBRL Taxonomy Extension Label Linkbase Document
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EX-101.PRE XBRL Taxonomy Extension Presentation Linkbase Document
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We have a history of operating losses and we do not expect to become profitable in the near future.
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Our technologies are in an early stage of development and are unproven.
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Our business is substantially dependent on our ability to develop, launch and generate revenue from our pharmaceutical and diagnostic programs.
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Our research and development activities, or that of our investees, may not result in commercially viable products.
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The timing and expenditures associated with the build-up of pre-launch inventory and capacity expansion.
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The results of previous clinical trials may not be predictive of future results, and our current and planned clinical trials may not satisfy the requirements of the United States (“U.S.”) Food and Drug Administration (“FDA”) or other non-U.S. regulatory authorities.
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We may require substantial additional funding, which may not be available to us on acceptable terms, or at all.
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We may finance future cash needs primarily through public or private offerings, debt financings or strategic collaborations, which may dilute your stockholdings in the Company.
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If our competitors develop and market products that are more effective, safer or less expensive than our future product candidates, our commercial opportunities will be negatively impacted.
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The regulatory approval process is expensive, time consuming and uncertain and may prevent us or our collaboration partners from obtaining approvals for the commercialization of some or all of our product candidates.
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Failure to recruit and enroll patients for clinical trials may cause the development of our product candidates to be delayed.
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Even if we obtain regulatory approvals for our product candidates, the terms of approvals and ongoing regulation of our products may limit how we manufacture and market our product candidates, which could materially impair our ability to generate anticipated revenues.
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We may not meet regulatory quality standards applicable to our manufacturing and quality processes.
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Even if we receive regulatory approval to market our product candidates, the market may not be receptive to our products.
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The loss of Phillip Frost, M.D., our Chairman and Chief Executive Officer, could have a material adverse effect on our business and product development.
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If we fail to attract and retain key management and scientific personnel, we may be unable to successfully develop or commercialize our product candidates.
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In the event that we successfully evolve from a company primarily involved in development to a company also involved in commercialization, we may encounter difficulties in managing our growth and expanding our operations successfully.
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If we fail to acquire and develop other products or product candidates, at all or on commercially reasonable terms, we may be unable to diversify or grow our business.
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We have no experience manufacturing our pharmaceutical product candidates other than at one of our Israeli facilities, and at our Mexican, and Spanish facilities, and we have no experience in manufacturing our diagnostic product candidates. We will therefore likely rely on third parties to manufacture and supply our pharmaceutical and diagnostics product candidates, and we would need to meet various standards to satisfy FDA regulations in order to manufacture on our own.
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We currently have no pharmaceutical or diagnostic marketing, sales or distribution capabilities other than in Chile, Mexico, Spain, and Uruguay for sales in those countries and our active pharmaceutical ingredients (“APIs”) business in Israel, and the sales force for our laboratory business based in Nashville, Tennessee. If we are unable to develop our sales and marketing and distribution capability on our own or through collaborations with marketing partners, we will not be successful in commercializing our pharmaceutical and diagnostic product candidates.
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Certain elements of our business are dependent on the success of ongoing and planned phase 3 clinical trials for
Alpharen
(Fermagate Tablets), and hGH-CTP.
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Independent clinical investigators and contract research organizations that we engage to conduct our clinical trials may not be diligent, careful or timely.
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The success of our business is dependent on the actions of our collaborative partners.
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Our exclusive worldwide agreement with Pfizer Inc. (“Pfizer”) is important to our business. If we do not successfully develop hGH-CTP and/or Pfizer does not successfully commercialize hGH-CTP, our business could be adversely affected.
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If we are unable to obtain and enforce patent protection for our products, our business could be materially harmed.
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If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology and products could be adversely affected.
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We rely heavily on licenses from third parties.
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We license patent rights to certain of our technology from third-party owners. If such owners do not properly maintain or enforce the patents underlying such licenses, our competitive position and business prospects will be harmed.
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Our commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of third parties.
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Adverse results in material litigation matters or governmental inquiries could have a material adverse effect upon our business and financial condition.
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If our products have undesirable effects on patients, we could be subject to litigation or product liability claims that could impair our reputation and have a material adverse effect upon our business and financial condition.
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Medicare prescription drug coverage legislation and future legislative or regulatory reform of the health care system may adversely affect our ability to sell our products or provide our services profitably.
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Failure to obtain and maintain regulatory approval outside the U.S. will prevent us from marketing our product candidates abroad.
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We may not have the funding available to pursue acquisitions.
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Acquisitions may disrupt our business, distract our management, may not proceed as planned, and may also increase the risk of potential third party claims and litigation.
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We may encounter difficulties in integrating acquired businesses.
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Non-U.S. governments often impose strict price controls, which may adversely affect our future profitability.
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Political and economic instability in Europe and Latin America and political, economic, and military instability in Israel or neighboring countries could adversely impact our operations.
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We are subject to fluctuations in currency exchange rates in connection with our international businesses.
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We have a large amount of goodwill and other intangible assets as a result of acquisitions and a significant write-down of goodwill and/or other intangible assets would have a material adverse effect on our reported results of operations and net worth.
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Our business may become subject to legal, economic, political, regulatory and other risks associated with international operations.
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The market price of our Common Stock may fluctuate significantly.
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The conversion and redemption features of our January 2013 convertible senior notes due in 2033 are classified as embedded derivatives and may continue to result in volatility in our financial statements, including having a material impact on our result of operations and recorded derivative liability.
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We have previously reported a material weakness in our internal control over financing reporting which may cause investors and stockholders to lose confidence in our financial reporting.
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Directors, executive officers, principal stockholders and affiliated entities own a significant percentage of our capital stock, and they may make decisions that you may not consider to be in your best interests or in the best interests of our stockholders.
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Compliance with changing regulations concerning corporate governance and public disclosure may result in additional expenses.
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If we are unable to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as they apply to us, or our internal controls over financial reporting are not effective, the reliability of our financial statements may be questioned and our Common Stock price may suffer.
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We may be unable to maintain our listing on the New York Stock Exchange (“NYSE”), which could cause our stock price to fall and decrease the liquidity of our Common Stock.
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Future issuances of Common Stock and hedging activities may depress the trading price of our Common Stock.
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Provisions in our charter documents and Delaware law could discourage an acquisition of us by a third party, even if the acquisition would be favorable to you.
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We do not intend to pay cash dividends on our Common Stock in the foreseeable future.
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ITEM 1.
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BUSINESS
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obtain requisite regulatory approval and compile clinical data for our most advanced product candidates;
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develop a focused commercialization capability both internationally and in the U.S.; and
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expand into other medical markets that provide significant opportunities and that we believe are complementary to and synergistic with our business.
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Products and technologies.
We intend to continue to pursue product and technology acquisitions and licenses that will complement our existing businesses and provide new product and market opportunities, improve our growth, enhance our profitability, leverage our existing assets, and contribute to our own organic growth.
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Commercial businesses.
We intend to continue to pursue acquisitions of commercial businesses that will both drive our growth and provide geographically diverse sales and distribution opportunities, particularly outside of the U.S.
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Early stage investments.
We have and may continue to make investments in early stage companies that we perceive to have valuable proprietary technology and significant potential to create value for OPKO as a shareholder.
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our ability to meet all necessary regulatory requirements to advance our product candidates through clinical trials and the regulatory approval process in the U.S. and abroad;
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the perception by physicians and other members of the health care community of the safety, efficacy, and benefits of our products compared to those of competing products or therapies;
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our ability to manufacture products we may develop on a commercial scale;
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the effectiveness of our sales and marketing efforts;
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the willingness of physicians to adopt a new diagnostic or treatment regimen represented by our technology;
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our ability to secure reimbursement for our product candidates,
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the price of the products we may develop and commercialize relative to competing products;
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our ability to accurately forecast and meet demand for our product candidates if regulatory approvals are achieved;
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our ability to develop a commercial scale infrastructure either on our own or with a collaborator, which would include expansion of existing facilities, including our manufacturing facilities, development of a sales and distribution network, and other operational and financial systems necessary to support our increased scale;
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our ability to maintain a proprietary position in our technologies; and
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our ability to rapidly expand the existing information technology infrastructure and configure existing operational, manufacturing, and financial systems (on our own or with third party collaborators) necessary to support our increased scale, which would include existing or additional facilities and or partners.
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the circumstances under which uses and disclosures of PHI are permitted or required without a specific authorization by the patient, including but not limited to treatment purposes, to obtain payments for services and health care operations activities;
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a patient’s rights to access, amend and receive an accounting of certain disclosures of PHI;
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the content of notices of privacy practices for PHI; and
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administrative, technical and physical safeguards required of entities that use or receive PHI electronically.
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Makes clear that situations involving impermissible access, acquisition, use or disclosure of protected health information are now presumed to be a breach unless the covered entity or business associate is able to demonstrate that there is a low probability that the information has been compromised;
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Defines the term “business associate” to include subcontractors and agents that receive, create, maintain or transmit protected health information on behalf of the business associate;
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Establishes new parameters for covered entities and business associates on uses and disclosures of PHI for
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fundraising and marketing; and
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Establishes clear restrictions on the sale of PHI without patient authorization.
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be found to be ineffective, unreliable, or otherwise inadequate or otherwise fail to receive regulatory approval;
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be difficult or impossible to manufacture on a commercial scale;
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be uneconomical to market or otherwise not be effectively marketed;
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fail to be successfully commercialized if adequate reimbursement from government health administration authorities, private health insurers, and other organizations for the costs of these products is unavailable;
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be impossible to commercialize because they infringe on the proprietary rights of others or compete with products marketed by others that are superior; or
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fail to be commercialized prior to the successful marketing of similar products by competitors.
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our ability to establish and maintain adequate infrastructure to support the commercial launch and sale of our diagnostic tests, including establishing adequate laboratory space, information technology infrastructure, sample collection and tracking systems, electronic ordering and reporting systems and other infrastructure and hiring adequate laboratory and other personnel;
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the success of the validation studies for our diagnostic tests under development and our ability to publish study results in peer-reviewed journals;
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the availability of alternative and competing tests or products and technological innovations or other advances in medicine that cause our technologies to be less competitive;
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the accuracy rates of such tests, including rates of false-negatives and/or false-positives;
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concerns regarding the safety or effectiveness or clinical utility of our diagnostic tests;
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changes in the regulatory environment affecting health care and health care providers, including changes in laws regulating laboratory testing and/or device manufacturers;
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the extent and success of our sales and marketing efforts and ability to drive adoption of our diagnostic tests;
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coverage and reimbursement levels by government payors and private insurers;
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pricing pressures and changes in third-party payor reimbursement policies; and
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intellectual property rights held by others or others infringing our intellectual property rights.
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the results of our clinical trials;
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our ability to recruit and enroll patients for our clinical trials;
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the efficacy, safety and reliability of our product candidates;
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the speed at which we develop our product candidates;
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our ability to design and successfully execute appropriate clinical trials;
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the timing and scope of regulatory approvals or clearances;
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our ability to commercialize and market any of our product candidates that may receive regulatory approval or clearance;
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appropriate coverage and adequate levels of reimbursement under private and governmental health insurance plans, including Medicare;
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our ability to protect intellectual property rights related to our products;
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our ability to have our partners manufacture and sell commercial quantities of any approved products to the market; and
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acceptance of future product candidates by physicians and other health care providers.
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a limited number of, and competition for, suitable patients with the particular types of disease required for enrollment in our clinical trials or that otherwise meet the protocol’s inclusion criteria and do not meet any of the exclusion criteria;
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a limited number of, and competition for, suitable serum or other samples from patients with particular types of disease required for our validation studies;
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a limited number of, and competition for, suitable sites to conduct our clinical trials;
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delay or failure to obtain FDA or other non-U.S. regulatory authorities’ approval or agreement to commence a clinical trial;
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delay or failure to obtain sufficient supplies of the product candidate for our clinical trials;
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requirements to provide the drugs, diagnostic tests, or medical devices required in our clinical trial protocols or clinical trials at no cost or cost, which may require significant expenditures that we are unable or unwilling to make;
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delay or failure to reach agreement on acceptable clinical trial agreement terms or clinical trial protocols with prospective sites or investigators; and
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delay or failure to obtain institutional review board (“IRB”) approval to conduct or renew a clinical trial at a prospective site.
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slower than expected rates of patient recruitment and enrollment;
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failure of patients to complete the clinical trial;
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unforeseen safety issues;
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lack of efficacy evidenced during clinical trials;
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termination of our clinical trials by one or more clinical trial sites;
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inability or unwillingness of patients or medical investigators to follow our clinical trial protocols; and
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inability to monitor patients adequately during or after treatment.
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restrictions on the products, manufacturers, or manufacturing process;
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adverse inspectional observations (Form 483), warning letters, or non-warning letters incorporating inspectional observations;
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civil and criminal penalties;
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injunctions;
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suspension or withdrawal of regulatory approvals or clearances;
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product seizures, detentions, or import bans;
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voluntary or mandatory product recalls and publicity requirements;
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total or partial suspension of production;
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imposition of restrictions on operations, including costly new manufacturing requirements; and
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refusal to approve or clear pending NDAs or supplements to approved NDAs, applications or pre-market notifications.
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a drug candidate may not be deemed safe or effective;
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a medical device candidate may not be deemed to be substantially equivalent to a lawfully marketed non-PMA device, in the case of a premarket notification;
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the FDA may not find the data from pre-clinical studies and clinical trials sufficient;
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the FDA may not approve our or our third-party manufacturer’s processes or facilities; or
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the FDA may change its approval or clearance policies or adopt new regulations.
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regulatory authorities may require the addition of labeling statements, specific warnings, a contraindication, or field alerts to physicians and pharmacies;
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regulatory authorities may withdraw their approval of the product and require us to take our approved product off the market;
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we may be required to change the way the product is administered, conduct additional clinical trials, or change the labeling of the product;
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we may have limitations on how we promote our products;
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sales of products may decrease significantly;
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we may be subject to litigation or product liability claims; and
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our reputation may suffer.
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timing of market introduction of competitive products;
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safety and efficacy of our product compared to other products;
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prevalence and severity of any side effects;
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potential advantages or disadvantages over alternative treatments;
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strength of marketing and distribution support;
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price of our products, both in absolute terms and relative to alternative treatments;
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availability of coverage and reimbursement from government and other third-party payors;
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potential product liability claims;
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limitations or warnings contained in a product’s regulatory authority-approved labeling; and
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changes in the standard of care for the targeted indications for any of our product candidates, which could reduce the marketing impact of any claims that we could make following applicable regulatory authority approval.
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difficulty integrating acquired technologies, products, services, operations, and personnel with the existing businesses;
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diversion of management’s attention in connection with both negotiating the acquisitions and integrating the businesses;
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strain on managerial and operational resources as management tries to oversee larger operations and investments;
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difficulty implementing and maintaining effective internal control over financial reporting at businesses that we acquire or invest in, particularly if they are not located near our existing operations;
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exposure to unforeseen liabilities of acquired companies or companies in which we invest;
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potential costly and time-consuming litigation, including stockholder lawsuits;
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potential issuance of securities to equity holders of the company being acquired with rights that are superior to the rights of holders of our Common Stock, or which may have a dilutive effect on our stockholders;
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the need to incur additional debt or use cash; and
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the requirement to record potentially significant additional future operating costs for the amortization of intangible assets.
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the announcement of new products or product enhancements by us or our competitors;
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results of our clinical trials and other development efforts;
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developments concerning intellectual property rights and regulatory approvals;
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variations in our and our competitors’ results of operations;
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changes in earnings estimates or recommendations by securities analysts, if our Common Stock is covered by analysts;
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developments in the biotechnology, pharmaceutical, diagnostic, and medical device industry;
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the results of product liability or intellectual property lawsuits;
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future issuances of our Common Stock or other securities, including debt;
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purchases and sales of our Common Stock by our officers, directors or affiliates;
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the addition or departure of key personnel;
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announcements by us or our competitors of acquisitions, investments, or strategic alliances; and
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general market conditions and other factors, including factors unrelated to our operating performance.
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High
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Low
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2014
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||||
First Quarter
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$
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10.25
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$
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7.32
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Second Quarter
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9.83
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7.82
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Third Quarter
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9.62
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8.09
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Fourth Quarter
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10.16
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8.02
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2013
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||||
First Quarter
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$
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7.83
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$
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4.83
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Second Quarter
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7.65
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6.14
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Third Quarter
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10.00
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7.13
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Fourth Quarter
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12.95
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8.17
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12/31/2009
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12/31/2010
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12/31/2011
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12/31/2012
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12/31/2013
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12/31/2014
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||||||||||||
OPKO Health, Inc.
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$
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100.00
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|
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$
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200.55
|
|
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$
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267.76
|
|
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$
|
262.84
|
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$
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461.20
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$
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545.90
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S&P 500
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100.00
|
|
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115.06
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|
|
117.49
|
|
|
136.30
|
|
|
180.44
|
|
|
205.14
|
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||||||
NASDAQ Biotechnology
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100.00
|
|
|
106.73
|
|
|
122.40
|
|
|
166.72
|
|
|
286.55
|
|
|
379.71
|
|
|
|
For the years ended December 31,
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||||||||||||||||||
(In thousands, except share and per share information)
|
|
2014
|
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2013
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2012
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2011
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2010
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||||||||||
Statement of operations data:
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||||||||||
Revenues
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|
$
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91,125
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|
|
$
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96,530
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|
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$
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47,044
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|
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$
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27,979
|
|
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$
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28,494
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|
Costs and expenses:
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|
|
|
|
|
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||||||||||
Cost of revenues
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|
48,009
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|
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48,860
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|
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27,878
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|
|
17,243
|
|
|
13,495
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|
|||||
Selling, general and administrative
|
|
57,940
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|
|
55,320
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|
|
27,795
|
|
|
19,169
|
|
|
18,133
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|
|||||
Research and development
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|
83,571
|
|
|
53,902
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|
|
19,520
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|
|
11,352
|
|
|
5,949
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|
|||||
In-process research and development
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|
12,055
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|
|
—
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|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other operating expenses
|
|
35,365
|
|
|
18,080
|
|
|
9,120
|
|
|
3,404
|
|
|
2,053
|
|
|||||
Total costs and expenses
|
|
236,940
|
|
|
176,162
|
|
|
84,313
|
|
|
51,168
|
|
|
39,630
|
|
|||||
Operating loss from continuing operations
|
|
(145,815
|
)
|
|
(79,632
|
)
|
|
(37,269
|
)
|
|
(23,189
|
)
|
|
(11,136
|
)
|
|||||
Other income and (expense), net
|
|
(25,212
|
)
|
|
(24,586
|
)
|
|
165
|
|
|
(1,044
|
)
|
|
(844
|
)
|
|||||
Loss from continuing operations before
income taxes and investment losses
|
|
(171,027
|
)
|
|
(104,218
|
)
|
|
(37,104
|
)
|
|
(24,233
|
)
|
|
(11,980
|
)
|
|||||
Income tax benefit (provision)
|
|
(24
|
)
|
|
(1,672
|
)
|
|
9,626
|
|
|
19,358
|
|
|
18
|
|
|||||
Loss from continuing operations before
investment losses
|
|
(171,051
|
)
|
|
(105,890
|
)
|
|
(27,478
|
)
|
|
(4,875
|
)
|
|
(11,962
|
)
|
|||||
Loss from investments in investees
|
|
(3,587
|
)
|
|
(11,456
|
)
|
|
(2,062
|
)
|
|
(1,589
|
)
|
|
(714
|
)
|
|||||
Loss from continuing operations
|
|
(174,638
|
)
|
|
(117,346
|
)
|
|
(29,540
|
)
|
|
(6,464
|
)
|
|
(12,676
|
)
|
|||||
Income (loss) from discontinued operations,
net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,181
|
|
|
(6,250
|
)
|
|||||
Net loss
|
|
(174,638
|
)
|
|
(117,346
|
)
|
|
(29,540
|
)
|
|
(1,283
|
)
|
|
(18,926
|
)
|
|||||
Less: Net loss attributable to noncontrolling
interests
|
|
(2,972
|
)
|
|
(2,939
|
)
|
|
(492
|
)
|
|
—
|
|
|
—
|
|
|||||
Net loss attributable to common shareholders before preferred stock dividend
|
|
(171,666
|
)
|
|
(114,407
|
)
|
|
(29,048
|
)
|
|
(1,283
|
)
|
|
(18,926
|
)
|
|||||
Preferred stock dividend
|
|
—
|
|
|
(420
|
)
|
|
(2,240
|
)
|
|
(2,379
|
)
|
|
(2,624
|
)
|
|||||
Net loss attributable to common shareholders
|
|
$
|
(171,666
|
)
|
|
$
|
(114,827
|
)
|
|
$
|
(31,288
|
)
|
|
$
|
(3,662
|
)
|
|
$
|
(21,550
|
)
|
Loss per share, basic and diluted:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss from continuing operations
|
|
$
|
(0.41
|
)
|
|
$
|
(0.32
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.06
|
)
|
Income (loss) from discontinued operations
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.02
|
|
|
$
|
(0.02
|
)
|
Net loss per share
|
|
$
|
(0.41
|
)
|
|
$
|
(0.32
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.08
|
)
|
Weighted average number of common shares outstanding basic and diluted:
|
|
422,014,039
|
|
|
355,095,701
|
|
|
295,750,077
|
|
|
280,673,122
|
|
|
255,095,586
|
|
|||||
Balance sheet data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
1,267,664
|
|
|
$
|
1,391,516
|
|
|
$
|
289,830
|
|
|
$
|
229,489
|
|
|
$
|
77,846
|
|
Working capital
|
|
$
|
59,758
|
|
|
$
|
150,878
|
|
|
$
|
26,275
|
|
|
$
|
80,804
|
|
|
$
|
29,793
|
|
Long-term liabilities
|
|
$
|
348,812
|
|
|
$
|
426,687
|
|
|
$
|
34,168
|
|
|
$
|
25,443
|
|
|
$
|
7,908
|
|
Series D Preferred Stock
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,386
|
|
|
$
|
24,386
|
|
|
$
|
26,128
|
|
Shareholders’ equity attributable to OPKO
|
|
$
|
842,144
|
|
|
$
|
876,410
|
|
|
$
|
179,386
|
|
|
$
|
160,882
|
|
|
$
|
23,052
|
|
Total shareholders’ equity
|
|
$
|
835,741
|
|
|
$
|
872,979
|
|
|
$
|
178,894
|
|
|
$
|
160,882
|
|
|
$
|
23,052
|
|
|
For the years ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
External expenses:
|
|
|
|
||||
Phase 3 clinical trials
|
$
|
14,512
|
|
|
$
|
13,078
|
|
CMC expense for biological products
|
18,692
|
|
|
1,765
|
|
||
Earlier-stage programs
|
9,093
|
|
|
4,599
|
|
||
Research and development employee-related expenses
|
21,642
|
|
|
17,215
|
|
||
Other unallocated internal research and development expenses
|
21,982
|
|
|
18,998
|
|
||
Third-party grants and funding from collaboration agreements
|
(2,350
|
)
|
|
(1,753
|
)
|
||
Total research and development expenses
|
$
|
83,571
|
|
|
$
|
53,902
|
|
|
For the years ended December 31,
|
||||||
|
2013
|
|
2012
|
||||
External expenses:
|
|
|
|
||||
Phase 3 clinical trials
|
$
|
13,078
|
|
|
$
|
—
|
|
Earlier-stage programs
|
6,364
|
|
|
—
|
|
||
Research and development employee-related expenses
|
17,215
|
|
|
8,315
|
|
||
Other unallocated internal research and development expenses
|
18,998
|
|
|
11,497
|
|
||
Third-party grants and funding from collaboration agreements
|
(1,753
|
)
|
|
(292
|
)
|
||
Total research and development expenses
|
$
|
53,902
|
|
|
$
|
19,520
|
|
Contractual obligations
(In thousands)
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Thereafter
|
|
Total
|
||||||||||||||
Open purchase orders
|
|
$
|
14,653
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,653
|
|
Operating leases
|
|
2,744
|
|
|
2,290
|
|
|
1,478
|
|
|
1,149
|
|
|
653
|
|
|
3,256
|
|
|
11,570
|
|
|||||||
2033 Senior Notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
87,642
|
|
|
—
|
|
|
87,642
|
|
|||||||
Mortgages and other debts payable
(1)
|
|
613
|
|
|
332
|
|
|
298
|
|
|
247
|
|
|
240
|
|
|
1,313
|
|
|
3,043
|
|
|||||||
Lines of credit
|
|
7,658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,658
|
|
|||||||
Interest commitments
|
|
2,779
|
|
|
2,710
|
|
|
2,699
|
|
|
2,688
|
|
|
489
|
|
|
55
|
|
|
11,420
|
|
|||||||
Total
|
|
$
|
28,447
|
|
|
$
|
5,332
|
|
|
$
|
4,475
|
|
|
$
|
4,084
|
|
|
$
|
89,024
|
|
|
$
|
4,624
|
|
|
$
|
135,986
|
|
(1)
|
Excludes
$5.2 million
of consolidated liabilities related to SciVac, as to which there is no recourse against us.
|
•
|
Unit of account – Most intangible assets are valued as single global assets rather than multiple assets for each jurisdiction or indication after considering the development stage, expected levels of incremental costs to obtain additional approvals, risks associated with further development, amount and timing of benefits expected to be derived in the future, expected patent lives in various jurisdictions and the intention to promote the asset as a global brand.
|
•
|
Estimated useful life – The asset life expected to contribute meaningful cash flows is determined after considering all pertinent matters associated with the asset, including expected regulatory approval dates (if unapproved), exclusivity periods and other legal, regulatory or contractual provisions as well as the effects of any obsolescence, demand, competition, and other economic factors, including barriers to entry.
|
•
|
Probability of Technical and Regulatory Success (“PTRS”) Rate – PTRS rates are determined based upon industry averages considering the respective programs development stage and disease indication and adjusted for specific information or data known at the acquisition date. Subsequent clinical results or other internal or external data obtained could alter the PTRS rate and materially impact the estimated fair value of the intangible asset in subsequent periods leading to impairment charges.
|
•
|
Projections – Future revenues are estimated after considering many factors such as initial market opportunity, pricing, sales trajectories to peak sales levels, competitive environment and product evolution. Future costs and expenses are estimated after considering historical market trends, market participant synergies and the timing and level of additional development costs to obtain the initial or additional regulatory approvals, maintain or further enhance the product. We generally assume initial positive cash flows to commence shortly after the receipt of expected regulatory approvals which typically may not occur for a number of years. Actual cash flows attributed to the project are likely to be different than those assumed since projections are subjected to multiple factors including trial results and regulatory matters which could materially change the ultimate commercial success of the asset as well as significantly alter the costs to develop the respective asset into commercially viable products.
|
•
|
Tax rates – The expected future income is tax effected using a market participant tax rate. Our recent valuations typically use a U.S. tax rate (and applicable state taxes) after considering the jurisdiction in which the intellectual property is held and location of research and manufacturing infrastructure. We also considered that any repatriation of earnings would likely have U.S. tax consequences.
|
•
|
Discount rate – Discount rates are selected after considering the risks inherent in the future cash flows; the assessment of the asset’s life cycle and the competitive trends impacting the asset, including consideration of any technical, legal, regulatory, or economic barriers to entry, as well as expected changes in standards of practice for indications addressed by the asset.
|
|
Page
|
|
December 31,
|
||||||
|
2014
(1)
|
|
2013
(1)
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
96,907
|
|
|
$
|
185,798
|
|
Accounts receivable, net
|
19,969
|
|
|
19,767
|
|
||
Inventory, net
|
16,604
|
|
|
18,079
|
|
||
Prepaid expenses and other current assets
|
9,389
|
|
|
19,084
|
|
||
Total current assets
|
142,869
|
|
|
242,728
|
|
||
Property, plant, equipment, and investment properties, net
|
16,411
|
|
|
17,027
|
|
||
Intangible assets, net
|
62,649
|
|
|
74,533
|
|
||
In-process research and development
|
793,152
|
|
|
793,341
|
|
||
Goodwill
|
224,292
|
|
|
226,373
|
|
||
Investments, net
|
22,453
|
|
|
30,653
|
|
||
Other assets
|
5,838
|
|
|
6,861
|
|
||
Total assets
|
$
|
1,267,664
|
|
|
$
|
1,391,516
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
8,744
|
|
|
$
|
13,414
|
|
Accrued expenses
|
60,912
|
|
|
65,874
|
|
||
Current portion of lines of credit and notes payable
|
13,455
|
|
|
12,562
|
|
||
Total current liabilities
|
83,111
|
|
|
91,850
|
|
||
2033 Senior Notes, net of discount and estimated fair value of embedded derivatives
|
131,454
|
|
|
211,912
|
|
||
Other long-term liabilities, principally contingent consideration and deferred tax liabilities
|
217,358
|
|
|
214,775
|
|
||
Total long-term liabilities
|
348,812
|
|
|
426,687
|
|
||
Total liabilities
|
431,923
|
|
|
518,537
|
|
||
Equity:
|
|
|
|
||||
Common Stock - $0.01 par value, 750,000,000 shares authorized; 433,421,677 and 414,818,195
shares issued at December 31, 2014 and 2013, respectively
|
4,334
|
|
|
4,148
|
|
||
Treasury Stock - 1,245,367 and 2,264,063 shares at December 31, 2014 and 2013,
respectively
|
(4,051
|
)
|
|
(7,362
|
)
|
||
Additional paid-in capital
|
1,529,096
|
|
|
1,379,383
|
|
||
Accumulated other comprehensive income (loss)
|
(12,392
|
)
|
|
3,418
|
|
||
Accumulated deficit
|
(674,843
|
)
|
|
(503,177
|
)
|
||
Total shareholders’ equity attributable to OPKO
|
842,144
|
|
|
876,410
|
|
||
Noncontrolling interests
|
(6,403
|
)
|
|
(3,431
|
)
|
||
Total shareholders’ equity
|
835,741
|
|
|
872,979
|
|
||
Total liabilities and equity
|
$
|
1,267,664
|
|
|
$
|
1,391,516
|
|
(1)
|
As of
December 31, 2014
and
December 31, 2013
, total assets include
$7.6 million
and
$6.7 million
, respectively, and total liabilities include
$12.1 million
and
$10.4 million
, respectively, related to SciVac, previously known as SciGen (I.L.) Ltd, a consolidated variable interest entity. SciVac’s consolidated assets are owned by SciVac and SciVac’s consolidated liabilities have no recourse against us. Refer to Note 4.
|
|
For the years ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Products
|
$
|
76,983
|
|
|
$
|
68,161
|
|
|
$
|
45,295
|
|
Revenue from services
|
8,666
|
|
|
11,658
|
|
|
1,749
|
|
|||
Revenue from transfer of intellectual property
|
5,476
|
|
|
16,711
|
|
|
—
|
|
|||
Total revenues
|
91,125
|
|
|
96,530
|
|
|
47,044
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Costs of revenues
|
48,009
|
|
|
48,860
|
|
|
27,878
|
|
|||
Selling, general and administrative
|
57,940
|
|
|
55,320
|
|
|
27,795
|
|
|||
Research and development
|
83,571
|
|
|
53,902
|
|
|
19,520
|
|
|||
In-process research and development
|
12,055
|
|
|
—
|
|
|
—
|
|
|||
Contingent consideration
|
24,446
|
|
|
6,947
|
|
|
785
|
|
|||
Amortization of intangible assets
|
10,919
|
|
|
11,133
|
|
|
8,335
|
|
|||
Total costs and expenses
|
236,940
|
|
|
176,162
|
|
|
84,313
|
|
|||
Operating loss
|
(145,815
|
)
|
|
(79,632
|
)
|
|
(37,269
|
)
|
|||
Other income and (expense), net:
|
|
|
|
|
|
||||||
Interest income
|
771
|
|
|
376
|
|
|
188
|
|
|||
Interest expense
|
(12,263
|
)
|
|
(13,802
|
)
|
|
(1,405
|
)
|
|||
Fair value changes of derivative instruments, net
|
(10,632
|
)
|
|
(45,942
|
)
|
|
1,218
|
|
|||
Other income (expense), net
|
(3,088
|
)
|
|
34,782
|
|
|
164
|
|
|||
Other income and (expense), net
|
(25,212
|
)
|
|
(24,586
|
)
|
|
165
|
|
|||
Loss before income taxes and investment losses
|
(171,027
|
)
|
|
(104,218
|
)
|
|
(37,104
|
)
|
|||
Income tax benefit (provision)
|
(24
|
)
|
|
(1,672
|
)
|
|
9,626
|
|
|||
Loss before investment losses
|
(171,051
|
)
|
|
(105,890
|
)
|
|
(27,478
|
)
|
|||
Loss from investments in investees
|
(3,587
|
)
|
|
(11,456
|
)
|
|
(2,062
|
)
|
|||
Net loss
|
(174,638
|
)
|
|
(117,346
|
)
|
|
(29,540
|
)
|
|||
Less: Net loss attributable to noncontrolling interests
|
(2,972
|
)
|
|
(2,939
|
)
|
|
(492
|
)
|
|||
Net loss attributable to common shareholders before
preferred stock dividend
|
(171,666
|
)
|
|
(114,407
|
)
|
|
(29,048
|
)
|
|||
Preferred stock dividend
|
—
|
|
|
(420
|
)
|
|
(2,240
|
)
|
|||
Net loss attributable to common shareholders
|
$
|
(171,666
|
)
|
|
$
|
(114,827
|
)
|
|
$
|
(31,288
|
)
|
Loss per share, basic and diluted:
|
|
|
|
|
|
||||||
Net loss per share
|
$
|
(0.41
|
)
|
|
$
|
(0.32
|
)
|
|
$
|
(0.11
|
)
|
Weighted average number of common shares
outstanding, basic and diluted
|
422,014,039
|
|
|
355,095,701
|
|
|
295,750,077
|
|
|
For the years ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net loss
|
$
|
(174,638
|
)
|
|
$
|
(117,346
|
)
|
|
$
|
(29,540
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Change in foreign currency translation and other comprehensive income (loss) from equity investments
|
(8,088
|
)
|
|
(1,825
|
)
|
|
2,289
|
|
|||
Available for sale investments:
|
|
|
|
|
|
||||||
Change in other unrealized gain (loss), net
|
(8,044
|
)
|
|
2,467
|
|
|
4,160
|
|
|||
Less: reclassification adjustments for (gains) losses included in net loss, net of tax
|
322
|
|
|
(4,580
|
)
|
|
—
|
|
|||
Comprehensive loss
|
(190,448
|
)
|
|
(121,284
|
)
|
|
(23,091
|
)
|
|||
Less: Comprehensive loss attributable to noncontrolling interest
|
(2,972
|
)
|
|
(2,939
|
)
|
|
(492
|
)
|
|||
Comprehensive loss attributable to common shareholders before preferred stock dividend
|
(187,476
|
)
|
|
(118,345
|
)
|
|
(22,599
|
)
|
|||
Preferred stock dividend
|
—
|
|
|
(420
|
)
|
|
(2,240
|
)
|
|||
Comprehensive loss attributable to common shareholders
|
$
|
(187,476
|
)
|
|
$
|
(118,765
|
)
|
|
$
|
(24,839
|
)
|
|
Common Stock
|
|
Treasury
|
|
Additional
Paid-In
Capital
|
|
Accumulated Other
Comprehensive
Income
|
|
Accumulated
Deficit
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||||||
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
|
|
|
|||||||||||||||||||||||
Balance at December 31, 2011
|
297,503,033
|
|
|
$
|
2,975
|
|
|
(2,488,477
|
)
|
|
$
|
(8,092
|
)
|
|
$
|
524,814
|
|
|
$
|
907
|
|
|
$
|
(359,722
|
)
|
|
$
|
—
|
|
|
$
|
160,882
|
|
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,131
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,131
|
|
|||||||
Exercise of Common Stock
options
|
1,019,967
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
2,224
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,234
|
|
|||||||
Exercise of Common Stock
warrants
|
65,015
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|||||||
Adjustment of Common Stock
|
(100,000
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issuance of Common Stock from
Treasury in connection with
OPKO Health Europe acquisition
at $4.12 per share
|
—
|
|
|
—
|
|
|
195,421
|
|
|
635
|
|
|
170
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
805
|
|
|||||||
Issuance of Common Stock in
connection with OPKO Lab
acquisition at $4.65 per share
|
7,072,748
|
|
|
71
|
|
|
—
|
|
|
—
|
|
|
32,817
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,888
|
|
|||||||
Net loss attributable to common
shareholders before preferred
stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,048
|
)
|
|
—
|
|
|
(29,048
|
)
|
|||||||
Net loss attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(492
|
)
|
|
(492
|
)
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,449
|
|
|
—
|
|
|
—
|
|
|
6,449
|
|
|||||||
Balance at December 31, 2012
|
305,560,763
|
|
|
$
|
3,056
|
|
|
(2,293,056
|
)
|
|
$
|
(7,457
|
)
|
|
$
|
565,201
|
|
|
$
|
7,356
|
|
|
$
|
(388,770
|
)
|
|
$
|
(492
|
)
|
|
$
|
178,894
|
|
|
Common Stock
|
|
Treasury
|
|
Additional
Paid-In
Capital
|
|
Accumulated Other
Comprehensive
Income
|
|
Accumulated
Deficit
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||||||
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
|
|
|
|||||||||||||||||||||||
Balance at December 31, 2012
|
305,560,763
|
|
|
$
|
3,056
|
|
|
(2,293,056
|
)
|
|
$
|
(7,457
|
)
|
|
$
|
565,201
|
|
|
$
|
7,356
|
|
|
$
|
(388,770
|
)
|
|
$
|
(492
|
)
|
|
$
|
178,894
|
|
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,983
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,983
|
|
|||||||
Exercise of Common Stock options
|
9,244,971
|
|
|
92
|
|
|
—
|
|
|
—
|
|
|
22,704
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,796
|
|
|||||||
Exercise of Common Stock
warrants
|
1,487,774
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
613
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
628
|
|
|||||||
Series D Preferred Stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,015
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,015
|
)
|
|||||||
Conversion of Series D Preferred
Stock
|
11,290,320
|
|
|
113
|
|
|
—
|
|
|
—
|
|
|
24,273
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,386
|
|
|||||||
Conversion of 2033 Senior Notes
|
2,396,145
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
20,815
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,839
|
|
|||||||
Issuance of Common Stock in
connection with OPKO Brazil
acquisition at $6.73 per share
|
64,684
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
434
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
435
|
|
|||||||
Issuance of Common Stock in
connection with OPKO Renal
acquisition at $7.16 per share
|
20,517,030
|
|
|
205
|
|
|
—
|
|
|
—
|
|
|
146,697
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
146,902
|
|
|||||||
Issuance of Common Stock in
connection with OPKO Biologics
acquisition at $8.49 per
share and fair value of stock
options and warrants exchanged
|
63,670,805
|
|
|
637
|
|
|
—
|
|
|
—
|
|
|
586,006
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
586,643
|
|
|||||||
Issuance of Common Stock in
connection with OPKO Health
Europe’s first Deferred Payment
at $7.52 per share
|
585,703
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
4,430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,435
|
|
|||||||
Issuance of Treasury Stock in
connection with OPKO Health
Europe’s Contingent
Consideration at $11.60 per share
|
|
|
|
|
28,993
|
|
|
95
|
|
|
242
|
|
|
|
|
|
|
|
|
337
|
|
||||||||||||
Net loss attributable to common
shareholders before preferred
stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(114,407
|
)
|
|
—
|
|
|
(114,407
|
)
|
|||||||
Net loss attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,939
|
)
|
|
(2,939
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
(3,938
|
)
|
|
—
|
|
|
—
|
|
|
(3,938
|
)
|
||||||||
Balance at December 31, 2013
|
414,818,195
|
|
|
$
|
4,148
|
|
|
(2,264,063
|
)
|
|
$
|
(7,362
|
)
|
|
$
|
1,379,383
|
|
|
$
|
3,418
|
|
|
$
|
(503,177
|
)
|
|
$
|
(3,431
|
)
|
|
$
|
872,979
|
|
|
Common Stock
|
|
Treasury
|
|
Additional
Paid-In
Capital
|
|
Accumulated Other
Comprehensive
Income
|
|
Accumulated
Deficit
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||||||
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
|
|
|
|||||||||||||||||||||||
Balance at December 31, 2013
|
414,818,195
|
|
|
$
|
4,148
|
|
|
(2,264,063
|
)
|
|
$
|
(7,362
|
)
|
|
$
|
1,379,383
|
|
|
$
|
3,418
|
|
|
$
|
(503,177
|
)
|
|
$
|
(3,431
|
)
|
|
$
|
872,979
|
|
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,737
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,737
|
|
|||||||
Exercise of Common Stock options
|
2,328,947
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
5,892
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,915
|
|
|||||||
Exercise of Common Stock warrants
|
3,063,894
|
|
|
31
|
|
|
—
|
|
|
—
|
|
|
6,982
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,013
|
|
|||||||
Issuance of Common Stock for OPKO Uruguay Ltda.
|
—
|
|
|
—
|
|
|
19,140
|
|
|
61
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
159
|
|
|||||||
Issuance of Common Stock upon
exchange of 2033 Senior Notes |
10,974,431
|
|
|
110
|
|
|
—
|
|
|
—
|
|
|
95,555
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
95,665
|
|
|||||||
Issuance of Common Stock for
Inspiro at 8.57 |
—
|
|
|
—
|
|
|
999,556
|
|
|
3,250
|
|
|
5,316
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,566
|
|
|||||||
Issuance of Common Stock for
OPKO Renal earnout |
2,236,210
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
21,133
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,155
|
|
|||||||
Net loss attributable to common
shareholders |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(171,666
|
)
|
|
—
|
|
|
(171,666
|
)
|
|||||||
Net loss attributable to noncontrolling
interests |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,972
|
)
|
|
(2,972
|
)
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,810
|
)
|
|
—
|
|
|
—
|
|
|
(15,810
|
)
|
|||||||
Balance at December 31, 2014
|
433,421,677
|
|
|
$
|
4,334
|
|
|
(1,245,367
|
)
|
|
$
|
(4,051
|
)
|
|
$
|
1,529,096
|
|
|
$
|
(12,392
|
)
|
|
$
|
(674,843
|
)
|
|
$
|
(6,403
|
)
|
|
$
|
835,741
|
|
|
For the years ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(174,638
|
)
|
|
$
|
(117,346
|
)
|
|
$
|
(29,540
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
14,927
|
|
|
15,216
|
|
|
10,160
|
|
|||
Non-cash interest on 2033 Senior Notes
|
5,662
|
|
|
5,980
|
|
|
—
|
|
|||
Amortization of deferred financing costs
|
2,007
|
|
|
1,170
|
|
|
—
|
|
|||
Losses from investments in investees
|
3,587
|
|
|
11,456
|
|
|
2,062
|
|
|||
Equity-based compensation – employees and non-employees
|
14,779
|
|
|
10,983
|
|
|
5,131
|
|
|||
(Recovery of) provision for bad debts
|
646
|
|
|
979
|
|
|
(95
|
)
|
|||
Provision for inventory obsolescence
|
1,082
|
|
|
2,015
|
|
|
2,688
|
|
|||
Revenue from receipt of equity
|
(240
|
)
|
|
(12,740
|
)
|
|
(159
|
)
|
|||
Realized gain on sale of equity securities
|
167
|
|
|
(29,881
|
)
|
|
—
|
|
|||
Gain on conversion of 3.00% convertible senior notes
|
(2,668
|
)
|
|
(972
|
)
|
|
—
|
|
|||
Loss on sale of property, plant and equipment
|
—
|
|
|
60
|
|
|
—
|
|
|||
Change in fair value of derivative instruments
|
10,632
|
|
|
45,942
|
|
|
(1,218
|
)
|
|||
In-process research and development
|
12,055
|
|
|
—
|
|
|
—
|
|
|||
Change in fair value of contingent consideration
|
24,446
|
|
|
6,947
|
|
|
785
|
|
|||
Deferred income tax (benefit) expense
|
1,017
|
|
|
599
|
|
|
(9,958
|
)
|
|||
Changes in assets and liabilities, net of the effects of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable
|
(3,919
|
)
|
|
754
|
|
|
763
|
|
|||
Inventory
|
(1,752
|
)
|
|
1,892
|
|
|
(5,807
|
)
|
|||
Prepaid expenses and other current assets
|
3,182
|
|
|
(1,131
|
)
|
|
(2,877
|
)
|
|||
Other assets
|
(3,378
|
)
|
|
(544
|
)
|
|
(361
|
)
|
|||
Accounts payable
|
(3,852
|
)
|
|
1,829
|
|
|
1,247
|
|
|||
Foreign currency measurement
|
945
|
|
|
(2,386
|
)
|
|
86
|
|
|||
Accrued expenses
|
4,934
|
|
|
3,525
|
|
|
1,678
|
|
|||
Net cash used in operating activities
|
(90,379
|
)
|
|
(55,653
|
)
|
|
(25,415
|
)
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Investments in investees
|
(589
|
)
|
|
(17,441
|
)
|
|
(3,396
|
)
|
|||
Proceeds from sale of equity securities
|
1,331
|
|
|
30,556
|
|
|
—
|
|
|||
Acquisition of businesses, net of cash
|
(1,683
|
)
|
|
20,528
|
|
|
(19,092
|
)
|
|||
Purchase of marketable securities
|
—
|
|
|
(50,027
|
)
|
|
(25,806
|
)
|
|||
Maturities of short-term marketable securities
|
—
|
|
|
50,027
|
|
|
24,997
|
|
|||
Proceeds from the sale of property, plant and equipment
|
—
|
|
|
636
|
|
|
—
|
|
|||
Capital expenditures
|
(4,734
|
)
|
|
(3,962
|
)
|
|
(1,472
|
)
|
|||
Net cash provided by (used in) investing activities
|
(5,675
|
)
|
|
30,317
|
|
|
(24,769
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Issuance of 2033 Senior Notes, net, including related parties
|
—
|
|
|
170,184
|
|
|
—
|
|
|||
Payment of Series D dividends, including related parties
|
—
|
|
|
(3,015
|
)
|
|
—
|
|
|||
Proceeds from the exercise of Common Stock options and warrants
|
12,928
|
|
|
23,425
|
|
|
2,279
|
|
|||
Cash from non-controlling interest
|
2,696
|
|
|
—
|
|
|
—
|
|
|||
Contingent consideration payments
|
(6,435
|
)
|
|
(2,539
|
)
|
|
—
|
|
|||
Borrowings on lines of credit
|
26,443
|
|
|
34,577
|
|
|
36,506
|
|
|||
Repayments of lines of credit
|
(28,369
|
)
|
|
(38,997
|
)
|
|
(32,754
|
)
|
|||
Net cash provided by financing activities
|
7,263
|
|
|
183,635
|
|
|
6,031
|
|
|||
Effect of exchange rate on cash and cash equivalents
|
(100
|
)
|
|
138
|
|
|
(2
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
(88,891
|
)
|
|
158,437
|
|
|
(44,155
|
)
|
|||
Cash and cash equivalents at beginning of period
|
185,798
|
|
|
27,361
|
|
|
71,516
|
|
|||
Cash and cash equivalents at end of period
|
$
|
96,907
|
|
|
$
|
185,798
|
|
|
$
|
27,361
|
|
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
6,276
|
|
|
$
|
3,407
|
|
|
$
|
945
|
|
Income taxes paid, net
|
$
|
954
|
|
|
$
|
1,321
|
|
|
$
|
575
|
|
RXi common stock received
|
$
|
—
|
|
|
$
|
12,500
|
|
|
$
|
—
|
|
Pharmsynthez common stock received
|
$
|
6,264
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-cash financing:
|
|
|
|
|
|
||||||
Shares issued upon the conversion of:
|
|
|
|
|
|
||||||
Series D Preferred Stock
|
$
|
—
|
|
|
$
|
24,386
|
|
|
$
|
—
|
|
2033 Senior Notes
|
$
|
95,665
|
|
|
$
|
20,839
|
|
|
$
|
—
|
|
Common Stock options and warrants, surrendered in net exercise
|
$
|
3,494
|
|
|
$
|
815
|
|
|
$
|
7
|
|
Issuance of capital stock to acquire:
|
|
|
|
|
|
||||||
OPKO Biologics
|
$
|
—
|
|
|
$
|
586,643
|
|
|
$
|
—
|
|
OPKO Renal
|
$
|
21,155
|
|
|
$
|
146,902
|
|
|
$
|
—
|
|
OPKO Brazil
|
$
|
—
|
|
|
$
|
436
|
|
|
$
|
—
|
|
OPKO Health Europe
|
$
|
—
|
|
|
$
|
4,404
|
|
|
$
|
805
|
|
OPKO Lab
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
32,888
|
|
OPKO Uruguay Ltda.
|
$
|
159
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Inspiro
|
$
|
8,566
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(In thousands)
|
OPKO Renal
|
|
OPKO Biologics
|
||||
Current assets
(1)
|
$
|
1,224
|
|
|
$
|
21,500
|
|
Intangible assets:
|
|
|
|
||||
In-process research and development
|
191,530
|
|
|
590,200
|
|
||
Patents
|
210
|
|
|
—
|
|
||
Total intangible assets
|
191,740
|
|
|
590,200
|
|
||
Goodwill
|
2,411
|
|
|
139,784
|
|
||
Property, plant and equipment
|
306
|
|
|
1,057
|
|
||
Other assets
|
—
|
|
|
371
|
|
||
Accounts payable and accrued expenses
|
(1,069
|
)
|
|
(9,866
|
)
|
||
Deferred tax liability
|
—
|
|
|
(156,403
|
)
|
||
Total purchase price
|
$
|
194,612
|
|
|
$
|
586,643
|
|
(1)
|
Current assets include cash of
$0.4 million
and
$20.5 million
related to the OPKO Renal and OPKO Biologics acquisitions, respectively.
|
|
For the years ended December 31,
|
||||||
(In thousands)
|
2013
|
|
2012
|
||||
Revenues
|
$
|
96,530
|
|
|
$
|
53,595
|
|
Loss from continuing operations
|
—
|
|
|
(63,479
|
)
|
||
Net loss
|
(147,546
|
)
|
|
(55,663
|
)
|
||
Net loss attributable to common shareholders
|
(145,027
|
)
|
|
(57,411
|
)
|
||
Basic and diluted loss per share
|
$
|
(0.37
|
)
|
|
$
|
(0.15
|
)
|
(in thousands)
|
|
|
|
|
||||
Investment type
|
|
Investment Carrying Value
|
|
Underlying Equity in Net Assets
|
||||
Equity method investments
|
|
$
|
9,400
|
|
|
$
|
30,787
|
|
Variable interest entity, equity method
|
|
981
|
|
|
—
|
|
||
Available for sale investments
|
|
5,758
|
|
|
|
|||
Warrants and options
|
|
6,314
|
|
|
|
|||
Total carrying value of investments
|
|
$
|
22,453
|
|
|
|
•
|
We delivered approximately
$9.6 million
to Pharmsynthez.
|
•
|
Pharmsynthez issued to us approximately
13.6 million
of its common shares.
|
•
|
Pharmsynthez agreed, at its option, to issue approximately
12.0 million
common shares to us or to pay us cash in Russian Rubles (“RUR”)
265.0 million
(approximately
$8.1 million
as of December 31, 2013) on or before December 31, 2013 (the “Pharmsynthez Note Receivable”). In January 2014, Pharmsynthez delivered to us approximately
12.0 million
shares of its common stock in satisfaction of the Pharmsynthez Notes Receivable.
|
•
|
We had a right to purchase additional shares in Pharmsynthez at a fixed price if Pharmsynthez pays us in cash rather than delivering to us the
12.0 million
Pharmsynthez common shares (the “Purchase Option”), however in connection with the settlement of the Pharmsynthez Note Receivable in January 2014, this right terminated.
|
•
|
We granted rights to certain technologies in the Russian Federation, Ukraine, Belarus, Azerbaijan and Kazakhstan (the “Territories”) to Pharmsynthez.
|
•
|
We will receive from Pharmsynthez royalties on net sales of products incorporating the technologies in the Territories, as well as a percentage of any sublicense income from third parties for the technologies in the Territories.
|
•
|
Pharmsynthez paid us
$9.5 million
under the various collaboration and funding agreements for the grant of rights and development of the technologies (the “Collaboration Payments”).
|
(In thousands)
|
December 31,
2014 |
|
December 31,
2013
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
393
|
|
|
$
|
2
|
|
Accounts receivable, net
|
316
|
|
|
283
|
|
||
Inventories, net
|
1,649
|
|
|
1,696
|
|
||
Prepaid expenses and other current assets
|
718
|
|
|
218
|
|
||
Total current assets
|
3,076
|
|
|
2,199
|
|
||
Property, plant and equipment, net
|
1,725
|
|
|
1,374
|
|
||
Intangible assets, net
|
875
|
|
|
1,111
|
|
||
Goodwill
|
1,553
|
|
|
1,821
|
|
||
Other assets
|
384
|
|
|
261
|
|
||
Total assets
|
$
|
7,613
|
|
|
$
|
6,766
|
|
Liabilities
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
445
|
|
|
$
|
1,136
|
|
Accrued expenses
|
4,446
|
|
|
6,498
|
|
||
Notes payable
|
5,189
|
|
|
1,537
|
|
||
Total current liabilities
|
10,080
|
|
|
9,171
|
|
||
Other long-term liabilities
|
2,042
|
|
|
1,240
|
|
||
Total liabilities
|
$
|
12,122
|
|
|
$
|
10,411
|
|
|
For the years ended December 31,
|
||||||
(In thousands)
|
2014
|
|
2013
|
||||
Accounts receivable, net
|
|
|
|
||||
Accounts receivable
|
$
|
21,875
|
|
|
$
|
21,651
|
|
Less: allowance for doubtful accounts
|
(1,906
|
)
|
|
(1,884
|
)
|
||
|
$
|
19,969
|
|
|
$
|
19,767
|
|
Inventories, net
|
|
|
|
||||
Finished products
|
$
|
12,116
|
|
|
$
|
13,374
|
|
Work in-process
|
1,011
|
|
|
1,350
|
|
||
Raw materials
|
4,116
|
|
|
4,132
|
|
||
Less: inventory reserve
|
(639
|
)
|
|
(777
|
)
|
||
|
$
|
16,604
|
|
|
$
|
18,079
|
|
Prepaid expenses and other current assets
|
|
|
|
||||
Prepaid supplies
|
$
|
1,123
|
|
|
$
|
945
|
|
Prepaid insurance
|
968
|
|
|
892
|
|
||
Pharmsynthez notes receivable
|
—
|
|
|
6,151
|
|
||
Other receivables
|
669
|
|
|
1,985
|
|
||
Taxes recoverable
|
2,417
|
|
|
3,458
|
|
||
Other
|
4,212
|
|
|
5,653
|
|
||
|
$
|
9,389
|
|
|
$
|
19,084
|
|
Property, plant, equipment and investment properties, net:
|
|
|
|
||||
Machinery and equipment
|
$
|
13,710
|
|
|
$
|
11,656
|
|
Building
|
3,171
|
|
|
3,615
|
|
||
Land
|
2,391
|
|
|
2,666
|
|
||
Furniture and fixtures
|
2,148
|
|
|
2,051
|
|
||
Software
|
1,695
|
|
|
807
|
|
||
Leasehold improvements
|
3,592
|
|
|
3,107
|
|
||
Construction in process
|
225
|
|
|
489
|
|
||
Less: accumulated depreciation
|
(10,521
|
)
|
|
(7,364
|
)
|
||
|
$
|
16,411
|
|
|
$
|
17,027
|
|
Intangible assets, net:
|
|
|
|
||||
Technologies
|
$
|
52,508
|
|
|
$
|
51,660
|
|
Customer relationships
|
22,108
|
|
|
22,725
|
|
||
Product registrations
|
8,763
|
|
|
9,692
|
|
||
Trade names
|
3,483
|
|
|
3,669
|
|
||
Covenants not to compete
|
8,639
|
|
|
8,671
|
|
||
Other
|
1,079
|
|
|
2,519
|
|
||
Less: accumulated amortization
|
(33,931
|
)
|
|
(24,403
|
)
|
||
|
$
|
62,649
|
|
|
$
|
74,533
|
|
Accrued expenses:
|
|
|
|
||||
Taxes payable
|
$
|
77
|
|
|
$
|
702
|
|
Deferred revenue
|
4,185
|
|
|
7,639
|
|
||
Clinical trials
|
8,643
|
|
|
3,342
|
|
||
Professional fees
|
1,860
|
|
|
402
|
|
||
Employee benefits
|
4,127
|
|
|
4,399
|
|
||
Deferred acquisition payments, net of discount
|
15
|
|
|
5,465
|
|
|
For the years ended December 31,
|
||||||
Contingent consideration
|
27,352
|
|
|
28,047
|
|
||
Other
|
14,653
|
|
|
15,878
|
|
||
|
$
|
60,912
|
|
|
$
|
65,874
|
|
|
|
|
|
||||
Other long-term liabilities:
|
|
|
|
||||
Contingent consideration – OPKO Renal
|
$
|
36,529
|
|
|
$
|
34,401
|
|
Contingent consideration – OPKO Health Europe
|
254
|
|
|
504
|
|
||
Contingent consideration – OPKO Diagnostics
|
6,992
|
|
|
8,340
|
|
||
Contingent consideration – CURNA
|
440
|
|
|
316
|
|
||
Mortgages and other debts payable
|
2,434
|
|
|
3,270
|
|
||
Deferred tax liabilities
|
167,153
|
|
|
166,435
|
|
||
Other, including deferred revenue
|
3,556
|
|
|
1,509
|
|
||
|
$
|
217,358
|
|
|
$
|
214,775
|
|
(In thousands)
|
Technology
|
|
In-process research and development
|
|
Customer relationships
|
|
Product registrations
|
|
Covenants not to compete
|
|
Tradename
|
|
Other
|
|
Total identified intangible assets
|
|
Goodwill
|
||||||||||||||||||
OPKO
Chile
(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,945
|
|
|
$
|
5,829
|
|
|
$
|
—
|
|
|
$
|
1,032
|
|
|
$
|
—
|
|
|
$
|
10,806
|
|
|
$
|
5,441
|
|
OPKO
Mexico
|
—
|
|
|
—
|
|
|
121
|
|
|
77
|
|
|
70
|
|
|
77
|
|
|
—
|
|
|
345
|
|
|
21
|
|
|||||||||
CURNA
|
—
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
290
|
|
|
10,290
|
|
|
4,827
|
|
|||||||||
OPKO Diagnostics
|
44,400
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,400
|
|
|
17,977
|
|
|||||||||
FineTech
|
2,700
|
|
|
—
|
|
|
14,200
|
|
|
—
|
|
|
1,500
|
|
|
400
|
|
|
—
|
|
|
18,800
|
|
|
11,623
|
|
|||||||||
OPKO Health Europe
|
3,017
|
|
|
1,459
|
|
|
436
|
|
|
2,930
|
|
|
187
|
|
|
349
|
|
|
—
|
|
|
8,378
|
|
|
8,062
|
|
|||||||||
OPKO Lab
|
1,370
|
|
|
—
|
|
|
3,860
|
|
|
—
|
|
|
6,900
|
|
|
1,830
|
|
|
70
|
|
|
14,030
|
|
|
29,629
|
|
|||||||||
SciVac
|
1,090
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,130
|
|
|
760
|
|
|||||||||
OPKO Brazil
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
686
|
|
|
686
|
|
|
—
|
|
|||||||||
OPKO Renal
|
—
|
|
|
191,530
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
210
|
|
|
191,740
|
|
|
2,411
|
|
|||||||||
OPKO Biologics
|
—
|
|
|
590,200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
590,200
|
|
|
139,784
|
|
|||||||||
OPKO Uruguay Ltda.
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
347
|
|
|
347
|
|
|
—
|
|
|||||||||
Weighted average amortization period
|
9 years
|
|
|
Indefinite
|
|
|
6 years
|
|
|
9 years
|
|
|
5 years
|
|
|
4 years
|
|
|
4 years
|
|
|
|
|
Indefinite
|
|
(1)
|
Includes intangible assets and goodwill related to ALS acquisition.
|
(In thousands)
|
Beginning
balance
|
|
Charged
to
expense
|
|
Written-off
|
|
Charged
to other
|
|
Ending
balance
|
|||||||
2014
|
|
|
|
|
|
|
|
|
|
|||||||
Allowance for doubtful accounts
|
$
|
(1,884
|
)
|
|
(646
|
)
|
|
321
|
|
|
303
|
|
|
$
|
(1,906
|
)
|
Inventory reserve
|
$
|
(777
|
)
|
|
(1,082
|
)
|
|
1,028
|
|
|
192
|
|
|
$
|
(639
|
)
|
Tax valuation allowance
|
$
|
(85,370
|
)
|
|
—
|
|
|
—
|
|
|
(46,561
|
)
|
|
$
|
(131,931
|
)
|
2013
|
|
|
|
|
|
|
|
|
|
|||||||
Allowance for doubtful accounts
|
$
|
(474
|
)
|
|
(979
|
)
|
|
28
|
|
|
(459
|
)
|
|
$
|
(1,884
|
)
|
Inventory reserve
|
$
|
(1,313
|
)
|
|
(2,015
|
)
|
|
2,188
|
|
|
363
|
|
|
$
|
(777
|
)
|
Tax valuation allowance
|
$
|
(59,145
|
)
|
|
(1,148
|
)
|
|
—
|
|
|
(25,077
|
)
|
|
$
|
(85,370
|
)
|
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
(In thousands)
|
Balance at January 1st
|
|
Acquisitions
|
|
Foreign exchange
|
|
Balance at December 31st
|
|
Balance at January 1
|
|
Acquisitions
|
|
Foreign exchange, other
|
|
Balance at December 31
|
||||||||||||||||
Pharmaceuticals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
CURNA
|
$
|
4,827
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,827
|
|
|
$
|
4,827
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,827
|
|
OPKO Mexico
|
114
|
|
|
—
|
|
|
(14
|
)
|
|
100
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
||||||||
OPKO Chile
|
6,102
|
|
|
—
|
|
|
(819
|
)
|
|
5,283
|
|
|
6,697
|
|
|
—
|
|
|
(595
|
)
|
|
6,102
|
|
||||||||
OPKO Health Europe
|
9,075
|
|
|
—
|
|
|
(1,062
|
)
|
|
8,013
|
|
|
8,712
|
|
|
—
|
|
|
363
|
|
|
9,075
|
|
||||||||
FineTech
|
11,698
|
|
|
—
|
|
|
—
|
|
|
11,698
|
|
|
11,698
|
|
|
—
|
|
|
—
|
|
|
11,698
|
|
||||||||
SciVac
|
1,739
|
|
|
—
|
|
|
(186
|
)
|
|
1,553
|
|
|
796
|
|
|
—
|
|
|
943
|
|
|
1,739
|
|
||||||||
OPKO Renal
|
2,069
|
|
|
—
|
|
|
—
|
|
|
2,069
|
|
|
—
|
|
|
2,411
|
|
|
(342
|
)
|
|
2,069
|
|
||||||||
OPKO Biologics
|
139,784
|
|
|
—
|
|
|
—
|
|
|
139,784
|
|
|
—
|
|
|
139,784
|
|
|
—
|
|
|
139,784
|
|
||||||||
Diagnostics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
OPKO Diagnostics
|
17,977
|
|
|
—
|
|
|
—
|
|
|
17,977
|
|
|
17,977
|
|
|
—
|
|
|
—
|
|
|
17,977
|
|
||||||||
OPKO Lab
|
32,988
|
|
|
—
|
|
|
—
|
|
|
32,988
|
|
|
29,629
|
|
|
—
|
|
|
3,359
|
|
|
32,988
|
|
||||||||
|
$
|
226,373
|
|
|
$
|
—
|
|
|
$
|
(2,081
|
)
|
|
$
|
224,292
|
|
|
$
|
80,450
|
|
|
$
|
142,195
|
|
|
$
|
3,728
|
|
|
$
|
226,373
|
|
(In thousands)
|
Embedded conversion option
|
|
2033 Senior Notes
|
|
Discount
|
|
Total
|
||||||||
Balance at December 31, 2013
|
$
|
101,087
|
|
|
$
|
158,064
|
|
|
$
|
(47,239
|
)
|
|
$
|
211,912
|
|
Amortization of debt discount
|
—
|
|
|
—
|
|
|
5,662
|
|
|
5,662
|
|
||||
Change in fair value of embedded derivative
|
12,213
|
|
|
—
|
|
|
—
|
|
|
12,213
|
|
||||
Conversion
|
(47,353
|
)
|
|
(70,422
|
)
|
|
19,442
|
|
|
(98,333
|
)
|
||||
Balance at December 31, 2014
|
$
|
65,947
|
|
|
$
|
87,642
|
|
|
$
|
(22,135
|
)
|
|
$
|
131,454
|
|
(In thousands)
|
Embedded conversion option
|
|
2033 Senior Notes
|
|
Discount
|
|
Total
|
||||||||
Balance at December 31, 2012
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Issuance of 3.00% convertible notes
|
59,204
|
|
|
175,000
|
|
|
(59,204
|
)
|
|
175,000
|
|
||||
Amortization of debt discount
|
—
|
|
|
—
|
|
|
6,596
|
|
|
6,596
|
|
||||
Change in fair value of embedded derivative
|
52,742
|
|
|
—
|
|
|
—
|
|
|
52,742
|
|
||||
Conversion
|
(10,859
|
)
|
|
(16,936
|
)
|
|
5,369
|
|
|
(22,426
|
)
|
||||
Balance at December 31, 2013
|
$
|
101,087
|
|
|
$
|
158,064
|
|
|
$
|
(47,239
|
)
|
|
$
|
211,912
|
|
|
December 31, 2014
|
|
December 31, 2013
|
|
Issuance Date
|
Stock price
|
$9.99
|
|
$8.44
|
|
$6.20
|
Conversion Rate
|
141.4827
|
|
141.4827
|
|
141.4827
|
Conversion Price
|
$7.07
|
|
$7.07
|
|
$7.07
|
Maturity date
|
February 1, 2033
|
|
February 1, 2033
|
|
February 1, 2033
|
Risk-free interest rate
|
1.40%
|
|
1.78%
|
|
1.12%
|
Estimated stock volatility
|
39%
|
|
55%
|
|
40%
|
Estimated credit spread
|
1,081 basis points
|
|
828 basis points
|
|
944 basis points
|
(In thousands)
|
December 31, 2014
|
|
December 31, 2013
|
|
Issuance Date
|
||||||
Fair value of 2033 Senior Notes:
|
|
|
|
|
|
||||||
With the embedded derivatives
|
$
|
129,009
|
|
|
$
|
218,081
|
|
|
$
|
175,000
|
|
Without the embedded derivatives
|
$
|
63,062
|
|
|
$
|
116,994
|
|
|
$
|
115,796
|
|
Estimated fair value of the embedded derivatives
|
$
|
65,947
|
|
|
$
|
101,087
|
|
|
$
|
59,204
|
|
(Dollars in thousands)
|
|
|
|
|
|
Balance Outstanding
|
||||||||
Lender
|
|
Interest rate on
borrowings at December 31, 2014
|
|
Credit line
capacity
|
|
December 31,
2014 |
|
December 31,
2013
|
||||||
Itau Bank
|
|
6.52%
|
|
$
|
1,800
|
|
|
965
|
|
|
$
|
1,999
|
|
|
Bank of Chile
|
|
6.34%
|
|
2,250
|
|
|
1,410
|
|
|
2,079
|
|
|||
BICE Bank
|
|
6.16%
|
|
1,700
|
|
|
1,249
|
|
|
516
|
|
|||
Corp Banca
|
|
—%
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
|||
BBVA Bank
|
|
5.00%
|
|
2,000
|
|
|
795
|
|
|
523
|
|
|||
Penta Bank
|
|
7.34%
|
|
1,200
|
|
|
1,008
|
|
|
946
|
|
|||
Security Bank
|
|
6.16%
|
|
640
|
|
|
361
|
|
|
1,075
|
|
|||
BCI
|
|
—%
|
|
—
|
|
|
—
|
|
|
198
|
|
|||
Estado Bank
|
|
5.30%
|
|
2,800
|
|
|
1,870
|
|
|
1,772
|
|
|||
Sabadell Bank
|
|
4.50%
|
|
182
|
|
|
—
|
|
|
—
|
|
|||
BBVA Bank
|
|
4.75%
|
|
304
|
|
|
—
|
|
|
—
|
|
|||
Santander Bank
|
|
4.50%
|
|
243
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
|
|
$
|
13,119
|
|
|
$
|
7,658
|
|
|
$
|
9,061
|
|
(In thousands)
|
December 31,
2014 |
|
December 31,
2013
|
||||
Current portion of notes payable
|
$
|
608
|
|
|
$
|
1,964
|
|
Other long-term liabilities
|
2,435
|
|
|
3,270
|
|
||
Total mortgage notes and other debt
|
$
|
3,043
|
|
|
$
|
5,234
|
|
(In thousands)
|
Foreign
currency
|
|
Unrealized
gain (loss) in
Accumulated
OCI
|
|
Total
|
||||||
Balance at December 31, 2013
|
$
|
1,371
|
|
|
$
|
2,047
|
|
|
$
|
3,418
|
|
Other comprehensive income before reclassifications, net of tax
(1)
|
(8,088
|
)
|
|
(8,044
|
)
|
|
(16,132
|
)
|
|||
Amounts reclassified from accumulated other comprehensive income, net of tax
(1)
|
—
|
|
|
322
|
|
|
322
|
|
|||
Net other comprehensive loss
|
(8,088
|
)
|
|
(7,722
|
)
|
|
(15,810
|
)
|
|||
Balance at December 31, 2014
|
$
|
(6,717
|
)
|
|
$
|
(5,675
|
)
|
|
$
|
(12,392
|
)
|
(1)
|
Effective tax rate of
40.13%
.
|
(In thousands)
|
Foreign
currency |
|
Unrealized
gain (loss) in Accumulated OCI |
|
Total
|
||||||
Balance at December 31, 2012
|
$
|
3,196
|
|
|
$
|
4,160
|
|
|
$
|
7,356
|
|
Other comprehensive income before reclassifications, net of tax (1)
|
(1,825
|
)
|
|
2,467
|
|
|
642
|
|
|||
Amounts reclassified from accumulated other comprehensive income, net of tax (1)
|
—
|
|
|
(4,580
|
)
|
|
(4,580
|
)
|
|||
Net other comprehensive loss
|
(1,825
|
)
|
|
(2,113
|
)
|
|
(3,938
|
)
|
|||
Balance at December 31, 2013
|
$
|
1,371
|
|
|
$
|
2,047
|
|
|
$
|
3,418
|
|
(1)
|
Effective tax rate of
38.47%
.
|
|
Year Ended
December 31,
2014
|
|
Year Ended
December 31,
2013
|
|
Year Ended
December 31,
2012
|
Expected term (in years)
|
1.0 - 10.0
|
|
1.0 - 7.0
|
|
1.0 - 7.0
|
Risk-free interest rate
|
.10% - 2.65%
|
|
0.15% - 2.45%
|
|
0.09% - 2.61%
|
Expected volatility
|
31% - 72%
|
|
0.31% - 83%
|
|
69%
|
Expected dividend yield
|
0%
|
|
0%
|
|
0%
|
Options
|
Number of
options
|
|
Weighted
average
exercise
price
|
|
Weighted
average
remaining
contractual
term (years)
|
|
Aggregate
intrinsic value
(in thousands)
|
|||||
Outstanding at December 31, 2013
|
21,350,597
|
|
|
$
|
4.47
|
|
|
4.8
|
|
$
|
85,186
|
|
Granted
|
5,437,500
|
|
|
$
|
8.47
|
|
|
|
|
|
||
Exercised
|
(2,723,666
|
)
|
|
$
|
3.45
|
|
|
|
|
|
||
Forfeited
|
(727,126
|
)
|
|
$
|
5.65
|
|
|
|
|
|
||
Expired
|
(37,386
|
)
|
|
$
|
0.71
|
|
|
|
|
|
||
Outstanding at December 31, 2014
|
23,299,919
|
|
|
$
|
5.50
|
|
|
5.37
|
|
$
|
104,797
|
|
Vested and expected to vest at December 31, 2014
|
21,943,140
|
|
|
$
|
5.35
|
|
|
5.25
|
|
$
|
101,859
|
|
Exercisable at December 31, 2014
|
11,876,035
|
|
|
$
|
3.89
|
|
|
4.09
|
|
$
|
72,481
|
|
|
For the years ended December 31,
|
||||||||||
(In thousands)
|
2014
|
|
2013
|
|
2012
|
||||||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
225
|
|
|
$
|
—
|
|
|
$
|
—
|
|
State
|
247
|
|
|
—
|
|
|
—
|
|
|||
Foreign
|
(1,514
|
)
|
|
(1,073
|
)
|
|
(332
|
)
|
|||
|
(1,042
|
)
|
|
(1,073
|
)
|
|
(332
|
)
|
|||
Deferred
|
|
|
|
|
|
||||||
Federal
|
—
|
|
|
(1,161
|
)
|
|
8,191
|
|
|||
State
|
(167
|
)
|
|
(104
|
)
|
|
1,038
|
|
|||
Foreign
|
1,185
|
|
|
666
|
|
|
729
|
|
|||
|
1,018
|
|
|
(599
|
)
|
|
9,958
|
|
|||
Total, net
|
$
|
(24
|
)
|
|
$
|
(1,672
|
)
|
|
$
|
9,626
|
|
(In thousands)
|
December 31, 2014
|
|
December 31, 2013
|
||||
Deferred income tax assets:
|
|
|
|
||||
Federal net operating loss
|
$
|
63,004
|
|
|
$
|
43,869
|
|
State net operating loss
|
12,050
|
|
|
6,987
|
|
||
Foreign net operating loss
|
25,825
|
|
|
20,545
|
|
||
Research and development expense
|
9,244
|
|
|
4,746
|
|
||
Research and development tax credit
|
6,077
|
|
|
4,876
|
|
||
Stock options
|
18,422
|
|
|
13,981
|
|
||
Accruals
|
1,764
|
|
|
1,936
|
|
||
Equity investments
|
8,038
|
|
|
4,756
|
|
||
Other
|
4,702
|
|
|
2,904
|
|
||
Deferred income tax assets
|
149,126
|
|
|
104,600
|
|
||
Deferred income tax liabilities:
|
|
|
|
||||
Intangible assets
|
(177,074
|
)
|
|
(179,414
|
)
|
||
Other
|
(4,305
|
)
|
|
(4,996
|
)
|
||
Deferred income tax liabilities
|
(181,379
|
)
|
|
(184,410
|
)
|
||
Net deferred income tax assets
|
(32,253
|
)
|
|
(79,810
|
)
|
||
Valuation allowance
|
(131,931
|
)
|
|
(85,370
|
)
|
||
Net deferred income tax liabilities
|
$
|
(164,184
|
)
|
|
$
|
(165,180
|
)
|
|
For the years ended December 31,
|
||||||||||
(In thousands)
|
2014
|
|
2013
|
|
2012
|
||||||
Unrecognized tax benefits at beginning of period
|
$
|
9,231
|
|
|
$
|
9,245
|
|
|
$
|
5,250
|
|
Gross increases – tax positions in prior period
|
717
|
|
|
575
|
|
|
4,467
|
|
|||
Gross decreases – tax positions in prior period
|
(396
|
)
|
|
(589
|
)
|
|
(472
|
)
|
|||
Lapse of Statute of Limitations
|
(472
|
)
|
|
|
|
|
|
|
|||
Settlements
|
(3,190
|
)
|
|
|
|
|
|
|
|||
Unrecognized tax benefits at end of period
|
$
|
5,890
|
|
|
$
|
9,231
|
|
|
$
|
9,245
|
|
|
For the years ended December 31,
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of federal benefit
|
2.5
|
%
|
|
2.4
|
%
|
|
3.1
|
%
|
Foreign income tax
|
(10.3
|
)%
|
|
(7.9
|
)%
|
|
(0.9
|
)%
|
Research and development tax credits
|
1.1
|
%
|
|
1.0
|
%
|
|
(0.3
|
)%
|
Non-Deductible components of Convertible Debt
|
(3.8
|
)%
|
|
(16.7
|
)%
|
|
—
|
%
|
Valuation allowance
|
(25.3
|
)%
|
|
(11.4
|
)%
|
|
(11.4
|
)%
|
Other
|
0.8
|
%
|
|
(3.9
|
)%
|
|
(0.7
|
)%
|
Total
|
—
|
%
|
|
(1.5
|
)%
|
|
24.8
|
%
|
(In thousands)
|
December 31, 2014
|
|
December 31, 2013
|
||||
Long-lived assets:
|
|
|
|
||||
U.S.
|
$
|
4,286
|
|
|
$
|
4,582
|
|
Foreign
|
12,125
|
|
|
12,445
|
|
||
Total
|
$
|
16,411
|
|
|
$
|
17,027
|
|
Year Ending
|
(In thousands)
|
||
2015
|
$
|
2,744
|
|
2016
|
2,290
|
|
|
2017
|
1,478
|
|
|
2018
|
1,149
|
|
|
2019
|
653
|
|
|
Thereafter
|
3,256
|
|
|
Total minimum lease commitments
|
$
|
11,570
|
|
|
For the years ended December 31,
|
||||||||||
(In thousands)
|
2014
|
|
2013
|
|
2012
|
||||||
Product revenues:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
76,983
|
|
|
$
|
68,161
|
|
|
$
|
45,295
|
|
Diagnostics
|
—
|
|
|
—
|
|
|
—
|
|
|||
Corporate
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
76,983
|
|
|
$
|
68,161
|
|
|
$
|
45,295
|
|
Revenue from services:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Diagnostics
|
8,426
|
|
|
10,833
|
|
|
395
|
|
|||
Corporate
|
240
|
|
|
825
|
|
|
1,354
|
|
|||
|
$
|
8,666
|
|
|
$
|
11,658
|
|
|
$
|
1,749
|
|
Revenue from transfer of intellectual property:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
5,285
|
|
|
$
|
15,160
|
|
|
$
|
—
|
|
Diagnostics
|
191
|
|
|
1,551
|
|
|
—
|
|
|||
Corporate
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
5,476
|
|
|
$
|
16,711
|
|
|
$
|
—
|
|
Operating (loss) income:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
(94,401
|
)
|
|
$
|
(29,809
|
)
|
|
$
|
(6,797
|
)
|
Diagnostics
|
(21,647
|
)
|
|
(22,199
|
)
|
|
(14,259
|
)
|
|||
Corporate
|
(27,725
|
)
|
|
(24,473
|
)
|
|
(15,628
|
)
|
|||
Less: Operating loss attributable to noncontrolling interests
|
(2,042
|
)
|
|
(3,151
|
)
|
|
(585
|
)
|
|||
|
$
|
(145,815
|
)
|
|
$
|
(79,632
|
)
|
|
$
|
(37,269
|
)
|
Depreciation and amortization:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
7,936
|
|
|
$
|
8,234
|
|
|
$
|
6,367
|
|
Diagnostics
|
6,894
|
|
|
6,833
|
|
|
3,614
|
|
|||
Corporate
|
97
|
|
|
149
|
|
|
179
|
|
|||
|
$
|
14,927
|
|
|
$
|
15,216
|
|
|
$
|
10,160
|
|
Net loss from investment in investees:
|
|
|
|
|
|
||||||
Pharmaceuticals
|
$
|
(3,587
|
)
|
|
$
|
(11,456
|
)
|
|
$
|
(2,062
|
)
|
Diagnostics
|
—
|
|
|
—
|
|
|
—
|
|
|||
Corporate
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
(3,587
|
)
|
|
$
|
(11,456
|
)
|
|
$
|
(2,062
|
)
|
Revenues:
|
|
|
|
|
|
||||||
United States
|
$
|
14,142
|
|
|
$
|
28,369
|
|
|
$
|
1,749
|
|
Chile
|
29,154
|
|
|
31,650
|
|
|
26,514
|
|
|||
Spain
|
21,323
|
|
|
18,800
|
|
|
6,124
|
|
|||
Israel
|
20,638
|
|
|
13,252
|
|
|
7,655
|
|
|||
Mexico
|
5,807
|
|
|
4,459
|
|
|
5,002
|
|
|||
Other
|
61
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
91,125
|
|
|
$
|
96,530
|
|
|
$
|
47,044
|
|
(In thousands)
|
December 31,
2014 |
|
December 31,
2013 |
||||
Assets:
|
|
|
|
||||
Pharmaceuticals
|
$
|
1,064,498
|
|
|
$
|
1,065,033
|
|
Diagnostics
|
108,072
|
|
|
116,944
|
|
||
Corporate
|
95,094
|
|
|
209,539
|
|
||
|
$
|
1,267,664
|
|
|
$
|
1,391,516
|
|
Goodwill:
|
|
|
|
||||
Pharmaceuticals
|
$
|
173,327
|
|
|
$
|
175,408
|
|
Diagnostics
|
50,965
|
|
|
50,965
|
|
||
Corporate
|
—
|
|
|
—
|
|
||
|
$
|
224,292
|
|
|
$
|
226,373
|
|
|
As of December 31, 2014
|
||||||||||||||||||
(In thousands)
|
Amortized
Cost
|
|
Gross
unrealized
gains in
Accumulated
OCI
|
|
Gross
unrealized
losses in
Accumulated
OCI
|
|
Gain/(Loss)
in
Accumulated
Deficit
|
|
Fair
value
|
||||||||||
Common stock investments, available for sale
|
$
|
11,479
|
|
|
$
|
293
|
|
|
$
|
(4,573
|
)
|
|
$
|
(1,441
|
)
|
|
$
|
5,758
|
|
Common stock options/warrants
|
1,425
|
|
|
216
|
|
|
—
|
|
|
4,673
|
|
|
6,314
|
|
|||||
Total assets
|
$
|
12,904
|
|
|
$
|
509
|
|
|
$
|
(4,573
|
)
|
|
$
|
3,232
|
|
|
$
|
12,072
|
|
|
As of December 31, 2013
|
||||||||||||||||||
(In thousands)
|
Amortized
Cost
|
|
Gross
unrealized
gains in
Accumulated
OCI
|
|
Gross
unrealized
losses in
Accumulated
OCI
|
|
Gain/(Loss)
in
Accumulated
Deficit
|
|
Fair
value
|
||||||||||
Common stock investments, available for sale
|
$
|
3,376
|
|
|
$
|
2,698
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,074
|
|
Common stock options/warrants
|
925
|
|
|
1,041
|
|
|
—
|
|
|
4,022
|
|
|
5,988
|
|
|||||
Total assets
|
$
|
4,301
|
|
|
$
|
3,739
|
|
|
$
|
—
|
|
|
$
|
4,022
|
|
|
$
|
12,062
|
|
|
Fair value measurements as of December 31, 2014
|
||||||||||||||
(In thousands)
|
Quoted
prices in
active
markets for
identical
assets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
71,286
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
71,286
|
|
Certificates of deposit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Common stock investments, available for sale
|
5,758
|
|
|
—
|
|
|
—
|
|
|
5,758
|
|
||||
Common stock options/warrants
|
—
|
|
|
6,314
|
|
|
—
|
|
|
6,314
|
|
||||
Forward contracts
|
—
|
|
|
36
|
|
|
—
|
|
|
36
|
|
||||
Total assets
|
$
|
77,044
|
|
|
$
|
6,350
|
|
|
$
|
—
|
|
|
$
|
83,394
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Embedded conversion option
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
65,947
|
|
|
$
|
65,947
|
|
Contingent consideration:
|
|
|
|
|
|
|
|
||||||||
CURNA
|
—
|
|
|
—
|
|
|
440
|
|
|
440
|
|
||||
OPKO Diagnostics
|
—
|
|
|
—
|
|
|
13,578
|
|
|
13,578
|
|
||||
OPKO Renal
|
—
|
|
|
—
|
|
|
55,780
|
|
|
55,780
|
|
||||
OPKO Health Europe
|
—
|
|
|
—
|
|
|
1,769
|
|
|
1,769
|
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
137,514
|
|
|
$
|
137,514
|
|
|
Fair value measurements as of December 31, 2013
|
||||||||||||||
(In thousands)
|
Quoted
prices in
active
markets for
identical
assets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
168,418
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
168,418
|
|
Certificates of deposit
|
—
|
|
|
827
|
|
|
—
|
|
|
827
|
|
||||
Pharmsynthez Notes Receivable & Purchase Option
|
—
|
|
|
6,151
|
|
|
—
|
|
|
6,151
|
|
||||
Common stock investments, available for sale
|
6,074
|
|
|
—
|
|
|
—
|
|
|
6,074
|
|
||||
Common stock options/warrants
|
—
|
|
|
5,988
|
|
|
—
|
|
|
5,988
|
|
||||
Forward contracts
|
—
|
|
|
49
|
|
|
—
|
|
|
49
|
|
||||
Total assets
|
$
|
174,492
|
|
|
$
|
13,015
|
|
|
$
|
—
|
|
|
$
|
187,507
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Embedded conversion option
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
101,087
|
|
|
$
|
101,087
|
|
Deferred acquisition payments, net of discount
|
—
|
|
|
—
|
|
|
5,465
|
|
|
5,465
|
|
||||
Contingent consideration:
|
|
|
|
|
|
|
|
||||||||
CURNA
|
—
|
|
|
—
|
|
|
573
|
|
|
573
|
|
||||
OPKO Diagnostics
|
—
|
|
|
—
|
|
|
13,776
|
|
|
13,776
|
|
||||
FineTech
|
—
|
|
|
—
|
|
|
3,124
|
|
|
3,124
|
|
||||
OPKO Renal
|
—
|
|
|
—
|
|
|
53,092
|
|
|
53,092
|
|
||||
OPKO Health Europe
|
—
|
|
|
—
|
|
|
1,043
|
|
|
1,043
|
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
178,160
|
|
|
$
|
178,160
|
|
|
December 31, 2014
|
||||||||||||||||||
(In thousands)
|
Carrying
Value
|
|
Total
Fair Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
2033 Senior Notes
|
$
|
65,507
|
|
|
$
|
63,062
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
63,062
|
|
|
December 31, 2014
|
||||||||||
(In thousands)
|
Contingent
consideration
|
|
Deferred
acquisition
payments, net
of discount
|
|
Embedded
conversion
option
|
||||||
Balance at December 31, 2013
|
$
|
71,620
|
|
|
$
|
5,465
|
|
|
$
|
101,087
|
|
Additions
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total losses (gains) for the period:
|
|
|
|
|
|
||||||
Included in results of operations
|
24,446
|
|
|
(735
|
)
|
|
12,213
|
|
|||
Foreign currency impact
|
(130
|
)
|
|
—
|
|
|
—
|
|
|||
Payments
|
(24,369
|
)
|
|
(4,730
|
)
|
|
—
|
|
|||
Conversion
|
—
|
|
|
—
|
|
|
(47,353
|
)
|
|||
Balance at December 31, 2014
|
$
|
71,567
|
|
|
$
|
—
|
|
|
$
|
65,947
|
|
|
December 31, 2013
|
||||||||||||||
(In thousands)
|
BZNE Note
and conversion feature |
|
Contingent
consideration |
|
Deferred
acquisition payments, net of discount |
|
Embedded
conversion option |
||||||||
Balance at December 31, 2012
|
$
|
2,040
|
|
|
$
|
20,056
|
|
|
$
|
10,103
|
|
|
$
|
—
|
|
Additions
|
—
|
|
|
47,710
|
|
|
—
|
|
|
59,204
|
|
||||
Total losses (gains) for the period:
|
|
|
|
|
|
|
|
||||||||
Included in results of operations
|
—
|
|
|
6,947
|
|
|
829
|
|
|
52,742
|
|
||||
Foreign currency remeasurement
|
|
|
31
|
|
|
|
|
|
|||||||
Conversion
|
(2,040
|
)
|
|
—
|
|
|
—
|
|
|
(10,859
|
)
|
||||
Payments
|
—
|
|
|
(3,124
|
)
|
|
(5,467
|
)
|
|
—
|
|
||||
Balance at December 31, 2013
|
$
|
—
|
|
|
$
|
71,620
|
|
|
$
|
5,465
|
|
|
$
|
101,087
|
|
(In thousands)
|
Balance Sheet Component
|
|
December 31,
2014 |
|
December 31,
2013 |
||||
Derivative financial instruments:
|
|
|
|
|
|
||||
Pharmsynthez Note Receivable and Purchase Option
|
Prepaid expenses and other current assets
|
|
$
|
—
|
|
|
$
|
6,151
|
|
Common stock options/warrants
|
Investments, net
|
|
$
|
6,314
|
|
|
$
|
5,988
|
|
Embedded conversion option
|
2033 Senior Notes, net of discount and estimated fair value of embedded derivatives
|
|
$
|
65,947
|
|
|
$
|
101,087
|
|
Forward contracts
(1)
|
Current portion of lines of credit and notes payable
|
|
$
|
36
|
|
|
$
|
49
|
|
(1)
|
Gains on forward contracts are recorded in Prepaid expenses and other current assets. Losses on forward contracts are recorded in Accrued expenses.
|
|
For the years ended December 31,
|
||||||||||
(In thousands)
|
2014
|
|
2013
|
|
2012
|
||||||
Derivative gain (loss):
|
|
|
|
|
|
||||||
Common stock options/warrants
(1)
|
$
|
1,193
|
|
|
$
|
6,544
|
|
|
$
|
1,350
|
|
2033 Senior Notes
|
(12,213
|
)
|
|
(52,742
|
)
|
|
—
|
|
|||
Forward contracts
|
$
|
388
|
|
|
$
|
256
|
|
|
$
|
(132
|
)
|
Total
|
$
|
(10,632
|
)
|
|
$
|
(45,942
|
)
|
|
$
|
1,218
|
|
(1)
|
Includes the Pharmsynthez Note Receivable and the Purchase Option.
|
(In thousands)
Days until maturity
|
|
Contract value
|
|
Fair value at
December 31, 2014
|
|
Effect on income (loss)
|
||||||
0 to 30
|
|
$
|
750
|
|
|
$
|
780
|
|
|
$
|
30
|
|
31 to 60
|
|
90
|
|
|
93
|
|
|
3
|
|
|||
61 to 90
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
91 to 120
|
|
68
|
|
|
71
|
|
|
3
|
|
|||
121 to 180
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
908
|
|
|
$
|
944
|
|
|
$
|
36
|
|
(In thousands)
Days until maturity
|
|
Contract value
|
|
Fair value at
December 31, 2013
|
|
Effect on income (loss)
|
||||||
0 to 30
|
|
$
|
472
|
|
|
$
|
489
|
|
|
$
|
17
|
|
31 to 60
|
|
561
|
|
|
579
|
|
|
18
|
|
|||
61 to 90
|
|
503
|
|
|
517
|
|
|
14
|
|
|||
91 to 120
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
121 to 180
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
More than 180
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
1,536
|
|
|
$
|
1,585
|
|
|
$
|
49
|
|
|
For the 2014 Quarters Ended
|
||||||||||||||
(In thousands, except per share data)
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Total revenues
|
$
|
22,274
|
|
|
$
|
23,545
|
|
|
$
|
19,773
|
|
|
$
|
25,533
|
|
Total costs and expenses
|
52,550
|
|
|
58,429
|
|
|
67,974
|
|
|
57,987
|
|
||||
Net loss
|
(45,088
|
)
|
|
(26,075
|
)
|
|
(50,014
|
)
|
|
(53,461
|
)
|
||||
Net loss attributable to common shareholders
|
(44,548
|
)
|
|
(25,478
|
)
|
|
(48,669
|
)
|
|
(52,971
|
)
|
||||
(Loss) income per share, basic and diluted:
|
$
|
(0.11
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.12
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
For the 2013 Quarters Ended
|
||||||||||||||
(In thousands, except per share data)
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Total revenues
|
$
|
31,376
|
|
|
$
|
23,821
|
|
|
$
|
20,641
|
|
|
$
|
20,692
|
|
Total costs and expenses
|
38,149
|
|
|
41,805
|
|
|
39,650
|
|
|
56,558
|
|
||||
Net loss
|
(34,763
|
)
|
|
(4,353
|
)
|
|
(60,801
|
)
|
|
(17,429
|
)
|
||||
Net loss attributable to common shareholders
|
(34,635
|
)
|
|
(3,394
|
)
|
|
(59,998
|
)
|
|
(16,800
|
)
|
||||
(Loss) income per share, basic and diluted:
|
$
|
(0.11
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.04
|
)
|
(a)
|
(1)
|
Financial Statements: See Part II, Item 8 of this report.
|
|
|
We filed our consolidated financial statements in Item 8 of Part II. Additionally, the financial statement schedule entitled “Schedule II – Valuation and Qualifying Accounts” has been omitted since the information required is included in the consolidated financial statements and notes thereto.
|
|
(2)
|
Exhibits: See below.
|
Exhibit
Number
|
Description
|
1.1
(13)
|
Underwriting Agreement, dated March 9, 2011, by and among OPKO Health, Inc., Jefferies & Company, Inc. and J.P. Morgan Securities LLC, as representatives for the underwriters named therein.
|
|
|
2.1
(1)
|
Merger Agreement and Plan of Reorganization, dated as of March 27, 2007, by and among Acuity Pharmaceuticals, Inc., Froptix Corporation, eXegenics, Inc., e-Acquisition Company I-A, LLC, and e-Acquisition Company II-B, LLC.
|
|
|
2.2
(4)+
|
Securities Purchase Agreement, dated May 2, 2008, by and among Vidus Ocular, Inc., OPKO Instrumentation, LLC, OPKO Health, Inc., and the individual sellers and noteholders named therein.
|
|
|
2.3
(10)
|
Purchase Agreement, dated February 17, 2010, by and among Ignacio Levy García and José de Jesús Levy García, Inmobiliaria Chapalita, S.A. de C.V., Pharmacos Exakta, S.A. de C.V., OPKO Health, Inc., OPKO Health Mexicana S. de R.L. de C.V., and OPKO Manufacturing Facilities S. de R.L. de C.V.
|
|
|
2.4
(15)+
|
Agreement and Plan of Merger, dated January 28, 2011, by and among CURNA Inc., KUR, LLC, OPKO Pharmaceuticals, LLC, OPKO CURNA, LLC, and certain individuals named therein.
|
|
|
2.5
(16)
|
Agreement and Plan of Merger, dated October 13, 2011, by and among OPKO Health, Inc., Claros Merger Subsidiary, LLC, Claros Diagnostics, Inc., and Ellen Baron, Marc Goldberg and Michael Magliochetti on behalf of the Shareholder Representative Committee.
|
|
|
2.6
(18)+
|
Stock Purchase Agreement, dated December 20, 2011, by and among FineTech Pharmaceutical Ltd., Arie Gutman, OPKO Holdings Israel Ltd., and OPKO Health, Inc.
|
|
|
2.7
(19)
|
Purchase Agreement, dated January 20, 2012, by and among OPKO Health, Inc., OPKO Chile S.A., Samuel Alexandre Arama, Inversiones SVJV Limitada, Bruno Sergiani, Inversiones BS Limitada, Pierre-Yves LeGoff, and Inversiones PYTT Limitada.
|
|
|
2.8
(20)+
|
Stock Purchase Agreement, dated August 2, 2012, by and among Farmadiet Group Holding, S.L., the Sellers party thereto, OPKO Health, Inc., and Shebeli XXI, S.L.U.
|
|
|
2.9
(22)+
|
Agreement and Plan of Merger, dated October 18, 2012, by and among Prost-Data, Inc. d/b/a OurLab, Our Labs, Endo Labs and Gold Lab, Jonathan Oppenheimer, M.D., OPKO Health, Inc., OPKO Laboratories Inc., and OPKO Labs, LLC.
|
|
|
2.10
(23)+
|
Share Purchase Agreement, dated January 8, 2013, by among Cytochroma Inc., Cytochroma Holdings ULC, Cytochroma Canada Inc., Cytochroma Development Inc., Proventiv Therapeutics, LLC, Cytochroma Cayman Islands, Ltd., OPKO Health, Inc., and OPKO IP Holdings, Inc.
|
|
|
2.11
(24)
|
Asset Purchase Agreement, dated March 1, 2013, by and between RXi Pharmaceuticals Corporation and OPKO Health, Inc.
|
|
|
2.12
(25)
|
Agreement and Plan of Merger, dated April 23, 2013, by and among OPKO Health, Inc., POM Acquisition Inc., and PROLOR Biotech, Inc.
|
|
|
3.1
(28)
|
Amended and Restated Certificate of Incorporation, as amended.
|
|
|
3.2
(3)
|
Amended and Restated Bylaws.
|
|
|
3.3
(8)
|
Certificate of Designation of Series D Preferred Stock.
|
|
|
4.1
(1)
|
Form of Common Stock Warrant.
|
|
|
4.2
(8)
|
Form of Common Stock Warrant.
|
|
|
4.3
(26)
|
Indenture, dated January 30, 2013, between OPKO Health, Inc. and Wells Fargo Bank, National Association.
|
|
|
10.1
(1)
|
Form of Lockup Agreement.
|
|
|
10.2
(2)
|
Office Lease dated November 13, 2007, by and between Frost Real Estate Holdings, LLC, and the OPKO Health, Inc.
|
|
|
10.3
(3)
|
Stock Purchase Agreement, dated December 4, 2007, by and between OPKO Health, Inc. and the members of The Frost Group, LLC.
|
|
|
10.4
(3)*
|
OPKO Health, Inc. 2007 Equity Incentive Plan.
|
|
|
10.5
(27)*
|
Amendment to OPKO Health, Inc. 2007 Equity Incentive Plan.
|
|
|
10.6
(4)
|
Form of Director Indemnification Agreement.
|
|
|
10.7
(4)
|
Form of Officer Indemnification Agreement.
|
|
|
10.8
(5)
|
Stock Purchase Agreement, dated August 8, 2008 by and between OPKO Health, Inc. and the Purchasers named therein.
|
10.9
(6)
|
Stock Purchase Agreement, dated February 23, 2009 by and between OPKO Health, Inc. and Frost Gamma Investments Trust.
|
|
|
10.10
(6)
|
Promissory Note to Frost Gamma Investments Trust, dated March 4, 2009.
|
|
|
10.11
(7)
|
Form of Stock Purchase Agreement for transactions between OPKO Health, Inc. and Nora Real Estate SA., Vector Group Ltd., Oracle Partners LP, Oracle Institutional Partners, LP., Chung Chia Company Limited, Gold Sino Assets Limited, and Grandtime Associates Limited.
|
|
|
10.12
(7)
|
Stock Purchase Agreement, dated June 10, 2009, by and among OPKO Health, Inc. and Sorrento Therapeutics, Inc.
|
|
|
10.13
(8)
|
Form of Securities Purchase Agreement for Series D Preferred Stock.
|
|
|
10.14
(9)*
|
Form of Restricted Share Award Agreement for Directors.
|
|
|
10.15
(9)
|
Cocrystal Discovery, Inc. Agreements.
|
|
|
10.16
(12)
|
Stock Purchase Agreement, dated October 1, 2009, by and among the Laboratoria Volta S.A., Farmacias Ahumada S.A., FASA Chile S.A., OPKO Chile Limitada and Inversones OPKO Limitada, subsidiaries of OPKO Health, Inc.
|
|
|
10.17
(11)+
|
Asset Purchase Agreement, dated October 12, 2009, by and between OPKO Health, Inc. and Schering Corporation.
|
|
|
10.18
(11)
|
Letter Agreement, dated June 29, 2010, by and between OPKO Health, Inc. and Schering Corporation.
|
*
|
Denotes management contract or compensatory plan or arrangement.
|
+
|
Certain confidential material contained in the document has been omitted and filed separately with the Securities and Exchange Commission.
|
(1)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 2, 2007, and incorporated herein by reference.
|
(2)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 14, 2007 for the Company’s three-month period ended September 30, 2007, and incorporated herein by reference.
|
(3)
|
Filed with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2008 and incorporated herein by reference.
|
(4)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 8, 2008 for the Company’s three-month period ended June 30, 2008, and incorporated herein by reference.
|
(5)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 12, 2008 for the Company’s three-month period ended September 30, 2008, and incorporated herein by reference.
|
(6)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 8, 2009 for the Company’s three-month period ended March 31, 2009, and incorporated herein by reference.
|
(7)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 7, 2009 for the Company’s three-month period ended June 30, 2009, and incorporated herein by reference.
|
(8)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 24, 2009, and incorporated herein by reference.
|
(9)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2009 for the Company’s three-month period ended September 30, 2009, and incorporated herein by reference.
|
(10)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2010 for the Company’s three-month period ended March 31, 2010, and incorporated herein by reference.
|
(11)
|
Filed with the Company’s Amendment to Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 3, 2011.
|
(12)
|
Filed with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 17, 2010.
|
(13)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 10, 2011, and incorporated herein by reference.
|
(14)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2011 for the Company’s three-month period ended March 31, 2011, and incorporated herein by reference.
|
(15)
|
Filed with the Company’s Quarterly Report on Form 10-Q/A filed with the Securities and Exchange Commission on July 5, 2011, and incorporated herein by reference.
|
(16)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2011 for the Company’s three-month period ended September 30, 2011, and incorporated herein by reference.
|
(17)
|
Filed with the Company’s Annual Report on Form 10-K/A filed with the Securities and Exchange Commission on July 28, 2011.
|
(18)
|
Filed with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2012.
|
(19)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2012 for the Company’s three-month period ended March 31, 2012, and incorporated herein by reference.
|
(20)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2012 for the Company’s three-month period ended September 30, 2012, and incorporated herein by reference.
|
(21)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 29, 2013, and incorporated herein by reference.
|
(22)
|
Filed with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 18, 2013.
|
(23)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2013 for the Company’s three-month period ended March 31, 2013, and incorporated herein by reference.
|
(24)
|
Filed with the Company’s Schedule 13D filed with the Securities and Exchange Commission on March 22, 2013, and incorporated herein by reference.
|
(25)
|
Filed as Annex A to the Company’s Preliminary Joint Proxy Statement/Prospectus, Form S-4, with the Securities Exchange Commission on June 27, 2013, as amended, and incorporated herein by reference.
|
(26)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 5, 2013, and incorporated herein by reference.
|
(27)
|
Filed with the Company’s Current Report on Form 8-K filed with the Securities Exchange Commission on August 30, 2013, and incorporated herein by reference.
|
(28)
|
Filed with the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 12, 2013 for the Company’s three month period ended September 30, 2013, and incorporated herein by reference.
|
Date: February 27, 2015
|
OPKO HEALTH, INC.
|
|
|
|
|
|
By:
|
/s/ Phillip Frost, M.D.
|
|
|
Phillip Frost, M.D.
|
|
|
Chairman of the Board and
|
|
|
Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
/s/ Phillip Frost, M.D.
|
|
Chairman of the Board and Chief Executive
|
|
February 27, 2015
|
Phillip Frost, M.D.
|
|
Officer
(Principal Executive Officer) |
|
|
|
|
|
|
|
/s/ Jane H. Hsiao
, Ph.D., MBA
|
|
Vice Chairman and Chief Technical Officer
|
|
February 27, 2015
|
Jane H. Hsiao
, Ph.D., MBA
|
|
|
|
|
|
|
|
|
|
/s/ Steven D. Rubin
|
|
Director and Executive Vice President –
|
|
February 27, 2015
|
Steven D. Rubin
|
|
Administration
|
|
|
|
|
|
|
|
/s/ Adam Logal
|
|
Senior Vice President, Chief Financial Officer,
|
|
February 27, 2015
|
Adam Logal
|
|
Chief Accounting Officer and Treasurer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/ Robert Baron
|
|
Director
|
|
February 27, 2015
|
Robert Baron
|
|
|
|
|
|
|
|
|
|
/s/ Thomas E. Beier
|
|
Director
|
|
February 27, 2015
|
Thomas E. Beier
|
|
|
|
|
|
|
|
|
|
/s/ Dmitry Kolosov
|
|
Director
|
|
February 27, 2015
|
Dmitry Kolosov
|
|
|
|
|
|
|
|
|
|
/s/ Richard A. Lerner, M.D.
|
|
Director
|
|
February 27, 2015
|
Richard A. Lerner, M.D.
|
|
|
|
|
|
|
|
|
|
/s/ John A. Paganelli
|
|
Director
|
|
February 27, 2015
|
John A. Paganelli
|
|
|
|
|
|
|
|
|
|
/s/ Richard C. Pfenniger, Jr.
|
|
Director
|
|
February 27, 2015
|
Richard C. Pfenniger, Jr.
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/s/ Alice Lin-Tsing Yu, M.D., Ph.D.
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Director
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February 27, 2015
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Alice Lin-Tsing Yu, M.D., Ph.D.
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Exhibit Number
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Description
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10.23
(+)
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Development and Commercialization License Agreement by and between OPKO Ireland, Ltd., a subsidiary of OPKO Health, Inc., and Pfizer, Inc. dated December 13, 2014.
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21
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Subsidiaries of the Company.
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23.1
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Consent of Ernst & Young LLP.
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31.1
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Certification by Phillip Frost, Chief Executive Officer, pursuant to Rule 13a-14(a) and 15d-14(a) of the Securities and Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for the quarterly period ended December 31, 2014.
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31.2
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Certification by Adam Logal, Chief Financial Officer, pursuant to Rule 13a-14(a) and 15d-14(a) of the Securities and Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for the quarterly period ended December 31, 2014.
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32.1
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Certification by Phillip Frost, Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the quarterly period ended December 31, 2014.
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32.2
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Certification by Adam Logal, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the quarterly period ended December 31, 2014.
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101.INS
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XBRL Instance Document
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101.SCH
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XBRL Taxonomy Extension Schema Document
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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1.
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DEFINITIONS.
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2.
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LICENSES.
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3.
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DEVELOPMENT AND COMMERCIALIZATION.
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4.
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TRIAL ACTIVITIES AND RESPONSIBILITIES.
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5.
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PAYMENTS.
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Regulatory Milestone
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Regulatory Milestone Payment
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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First achievement of *** of a Licensed Product for an Approved Indication in ***
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***
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Annual Worldwide Net Sales
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Marginal Royalty Rate
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Annual Worldwide Net Sales up to and including ***
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***
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Annual Worldwide Net Sales above ***, up to and including ***
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***
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Annual Worldwide Net Sales above ***
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***
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Annual Net Sales in the ***
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Marginal Royalty Rate
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Annual Net Sales in the *** up to and including ***
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***
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Annual Net Sales in the *** above ***, up to and including ***
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***
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Annual Net Sales in the *** above ***
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***
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Annual Net Sales in ***
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Marginal Royalty Rate
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Annual Net Sales in *** up to and including ***
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***
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Annual Net Sales in *** above ***, up to and including ***
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***
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Annual Net Sales in *** above ***
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***
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Annual Net Sales in ***
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Marginal Royalty Rate
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Annual Net Sales in *** up to and including ***
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***
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Annual Net Sales in *** above ***, up to and including ***
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***
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Annual Net Sales in *** above ***
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***
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Annual Net Sales in *** and ***
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Marginal Royalty Rate
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Annual Net Sales in *** and *** up to and including ***
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***
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Annual Net Sales in *** and *** above ***, up to and including ***
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***
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Annual Net Sales in *** and *** above ***
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***
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Annual Net Sales in *** and ***
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Marginal Royalty Rate
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Annual Net Sales in *** and *** up to and including ***
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***
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Annual Net Sales in *** and *** above ***, up to and including ***
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***
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Annual Net Sales in *** and *** above ***
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***
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Annual Net Sales in *** and ***
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Marginal Royalty Rate
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Annual Net Sales in *** and *** up to and including ***
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***
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Annual Net Sales in *** and *** above ***, up to and including ***
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***
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Annual Net Sales in *** and *** above ***
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***
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Year
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***
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*** Period
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$***
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*** Period
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$***
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*** Period
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$***
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Year
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***
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*** Period
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$***
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*** Period
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$***
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*** Period
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$***
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Year
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***
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*** Period
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$***
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*** Period
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$***
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*** Period
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$***
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Year
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***
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*** Period
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***
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*** Period
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***
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*** Period
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***
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Year
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***
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*** Period
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***
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*** Period
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***
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*** Period
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***
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Year
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***
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*** Period
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***
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*** Period
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***
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*** Period
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***
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Year
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***
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*** Period
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***
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*** Period
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***
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*** Period
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***
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Annual Aggregate *** Franchise Net Sales
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Less than or equal to *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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More than *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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Annual Aggregate *** Franchise Net Sales up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***
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***
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***
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Annual Aggregate *** Franchise Net Sales
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Less than or equal to *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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More than *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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Annual Aggregate *** Franchise Net Sales up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***
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***
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***
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Annual Aggregate *** Franchise Net Sales
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Less than or equal to *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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More than *** of Annual Aggregate *** Franchise Gross Profit is Attributable to Licensed Products
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Annual Aggregate *** Franchise Net Sales up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***, up to and including ***
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***
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***
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Annual Aggregate *** Franchise Net Sales above ***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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***
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6.
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INTELLECTUAL PROPERTY.
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7.
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CONFIDENTIALITY.
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8.
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REPRESENTATIONS, WARRANTIES AND COVENANTS.
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9.
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TERM AND TERMINATION.
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10.
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LIMITATION OF LIABILITY, INDEMNIFICATION AND INSURANCE.
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11.
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MISCELLANEOUS.
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PFIZER INC.
By:
Name:
Title:
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OPKO IRELAND LTD.
By:
Name: Brian V. Elliott
Title: Director
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***
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•
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hGH-CTP in global clinical development for the treatment of pediatric and adult growth hormone deficiency (GHD)
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•
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hGH-CTP has potential to reduce dosing frequency of human growth hormone to single weekly injection from current standard of daily injection
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•
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OPKO to receive upfront payment of $295 million and eligible to receive up to an additional $275 million upon achievement of regulatory milestones
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•
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Upon Pfizer’s commercialization of hGH-CTP, OPKO is eligible to receive royalty and/or profit sharing payments
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•
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Pfizer to obtain exclusive license to commercialize hGH-CTP globally
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NAME
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JURISDICTION OF INCORPORATION
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OPKO Instrumentation, LLC
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Delaware
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OPKO Pharmaceuticals, LLC
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Delaware
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OPKO Diagnostics, LLC
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Delaware
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OPKO Chile, S.A.
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Chile
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Pharmacos Exakta S.A. de C.V.
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Mexico
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FineTech Pharmaceutical Ltd.
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Israel
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Farmadiet Group Holdings, Ltd
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Spain
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OPKO Lab, LLC
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Florida
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SciVac (Israel) Ltd.
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Israel
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OPKO Biologics, Ltd
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Israel
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OPKO Ireland Global Holdings, Ltd
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Ireland
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OPKO Ireland, Ltd
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Ireland
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OPKO Canada, Inc.
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Canada
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OPKO Renal, LLC
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Canada
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Curna, Inc.
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Delaware
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Inspiro Medical, Ltd
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Israel
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OPKO do Brasil Comercio de Produtos Farmaceuticos, Ltda
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Brazil
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OPKO Uruguay, Ltd
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Uruguay
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1.
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Registration Statement (Form S-1 No. 333-177962) of OPKO Health, Inc. and subsidiaries,
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2.
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Registration Statement (Form S-3 No. 333-172168) of OPKO Health, Inc. and subsidiaries,
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3.
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Registration Statement (Form S-8 No. 333-144040) of OPKO Health, Inc. and subsidiaries,
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4.
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Registration Statement (Form S-3 No. 333-189369) of OPKO Health, Inc. and subsidiaries,
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5.
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Registration Statement (Form S-4 No. 333-189640) of OPKO Health, Inc. and subsidiaries,
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6.
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Registration Statement (Form S-3 No. 333-190360) of OPKO Health, Inc. and subsidiaries,
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7.
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Registration Statement (Form S-8 No. 333-190899) of OPKO Health, Inc. and subsidiaries, and
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8.
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Registration Statement (Form S-8 No. 333-190900) of OPKO Health, Inc. and subsidiaries
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(1)
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I have reviewed this Annual Report on Form 10-K of OPKO Health, Inc.;
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(2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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(3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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(4)
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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(5)
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 27, 2015
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/s/Phillip Frost, M.D.
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Phillip Frost, M.D.
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Chief Executive Officer
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(1)
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I have reviewed this Annual Report on Form 10-K of OPKO Health, Inc.;
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(2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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(3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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(4)
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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(5)
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 27, 2015
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/s/ Adam Logal
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Adam Logal
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Senior Vice President, Chief Financial Officer,
Chief Accounting Officer and Treasurer
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Date: February 27, 2015
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/s/ Phillip Frost, M.D.
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Phillip Frost, M.D.
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Chief Executive Officer
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Date: February 27, 2015
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/s/ Adam Logal
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Adam Logal
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Senior Vice President, Chief Financial Officer
Chief Accounting Officer and Treasurer
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