Wednesday, July 15, 2015

Lawsuit Alleges Biotech Guru Steve Burrill Embezzled $17 Million

Steve Burrill, photo
California biotech maven Steve Burrill, once a keynote speaker at such events as the annual BIO industry conference, has been charged with embezzling more than $17 million from an investment fund bearing his name.

The lawsuit surfaced in a spate of articles this month beginning with a piece July 10 by Dawn Lim of the Wall Street Journal. She wrote,
“The lawsuit, filed on July 6 with the Superior Court of California in San Francisco, alleges that Mr. Burrill, as well as corporate entities and individuals tied to him, embezzled more than $17 million from Burrill Life Sciences Capital Fund III L.P. between late 2007 and 2013.
 “The lawsuit also claims that the improper use of the fund’s money drained it of capital to support further investments in companies it backed, causing 'more than $30 million in investment losses.'
 “Earlier this year, investors in Burrill Life Sciences Capital Fund III L.P. installed executives from San Francisco-based Kearny Venture Partners to manage the fund. A corporate entity affiliated with Kearny authorized the lawsuit."
John Carroll of Fiercebiotech wrote,
“'Burrill was also a fraudster,’ the suit goes on. ‘Shortly after his company assumed the helm of the Fund as its General Partner, he started looting the Fund's cash and diverting it to entities he wholly owned or controlled.’” 
Reports of financial irregularities surfaced a little more than a year ago when Burrill was removed from control of his fund.

Over the years, Burrill raised more than $1 billion for life sciences financing via his investment banking firm. He produced an annual state-of-the-industry study that was something of a bible.

In 2006, his firm organized an international stem cell conference that was partly a celebration of the California stem cell agency. 

None of the stories published about the latest lawsuit reported comments from Burrill or his representatives.

Here are links to other stories on the matter: San Francisco Business Times, Biospace, Biocentury and Giacor Consulting.

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