A Hudson Valley homeopathic medicine company has filed for bankruptcy protection while claiming that a former adviser misappropriated assets.
Topical Biomedics Inc. petitioned for Chapter 11 reorganization on Nov. 11 in White Plains bankruptcy court, declaring $437,628 in assets and $2.4 million in liabilities. Simultaneously, it filed a lawsuit in bankruptcy court against former employee and adviser John P. Takacs.
After Takacs allegedly failed to comply with the terms of a licensing deal, court documents state, it became clear to the board of directors that “the entire transaction … was a ruse by Takacs to wrest control of the assets.”
Takacs did not reply to an email that asked for his side of the story.
Topical Biomedics has an office in Florida, Orange County, and a warehouse in West Hurley, Ulster County.
It makes Topricin pain relief creams for aches, pains, burns, and skin issues. The drugs are registered with the U.S. Food and Drug Administration, but the FDA does not evaluate homeopathic products for safety and effectiveness.
The company was founded in 1994. It struggled financially for decades, according to the bankruptcy records, with poor money management, the death of a founding partner, and lack of oversight when the board of directors disbanded.
A new board was formed in 2018 and set out to restructure the business. Then the Covid pandemic, beginning in 2020, disrupted manufacturing and distribution.
Topical Biomedics explored unconventional financing, according to an affidavit by board chairman Dennis Barnett.
Takacs was employed from 2020 to early 2024 and sometimes used the title of chief investment officer, according to the lawsuit, although the board never formally gave him that position.
In 2023, Topical Biomedics made a deal with Takacs “to spur funding and establish new opportunities.”
They had already formed a company – Fundamental Topricin Inventory – that was to seek financing and be co-owned, according to the lawsuit.
Then this past January, Topical Biomedics granted rights to a company operated by Takacs to “commercialize its formulas, data, inventory, and relationships.”
Topical Biomedics claims that Takacs replaced managers of Fundamental Topricin Inventory (since renamed as AltWellRx Inc.) with people loyal to him; has made the company a wholly owned subsidiary of his own business; and has misappropriated assets.
Topical Biomedics is asking bankruptcy court to undo the licensing deal, stop Takacs from dissipating property, and enable the company “to operate in Chapter 11 with minimum disruption to its operations.”
The company is represented by Wappingers Falls attorney Michelle L. Trier.
