EXCLUSIVE: Millionaire Covid entrepreneur allegedly told his father not to stress and that he wasn’t ‘cutting him out’ of booming $108M RAT business – as his murky past is revealed
- Greg Hough, 58, alleges his son, Jackson Hough, cut him out of their RAT empire
- Jackson, 31, a former electrician from Queensland with no experience in health
- He has a history of drug possession dating back to 2014 when he was just 23
- Mr Hough ran the US branch of the business from his home in Houston, Texas
- Son ran Australian branch, which imported RATs from China during Delta wave
- Legal feud over ownership was launched when business Down Under boomed
- Do you know more? Email [email protected]
A young pharmaceutical mogul embroiled in a legal battle with his dad over their $108million Covid test empire was sentenced to jail for a string of drug offences before his family’s company hit the jackpot.
Jackson Hough, 31, is accused of cutting his father, Gregory Hough, out of Hough Pharma Pty Ltd when sales rapid antigen tests started booming during the Delta wave in 2021.
The business was set up in Australia in September 2020 – about a year before RATs were commonplace – with Jackson, a former electrician with no healthcare experience, taking on the role of sole shareholder.
Hough Pharma subsequently landed international supply deals to import RATs from China, which were approved by the Therapeutic Goods Administration (TGA) for distribution in Australia in August 2021.
The explosion in sales triggered the fallout over ownership.
The case was reviewed in Brisbane Supreme Court on September 8, and will go a four-day trial from October 18.
However, Daily Mail Australia can reveal Jackson had a chequered history with the law before he landed a RAT empire.
Pictured: Jackson Hough, who ran the Australian branch of Hough Pharma, stood before a court for drug possession on multiple occasions
His charges, which were all heard in Southport Magistrates Court, date back to 2014 when he pleaded guilty to drug possession, driving without a licence, and having a knife in a public place at the age of 23.
He was ordered to do 120 hours of community service, was banned from having a licence for a month, and fined $700.
Three years later, in 2017, Jackson appeared before the court again – charged with five counts of drug possession, unlawful possession of a semi-automatic rifle, two centre fire action bolt rifles, a shotgun, and an air rifle.
He was sentenced to jail for six to nine months per offence, but was granted parole.
In August 2019, he pleaded guilty to a further five drug counts of drug possession, failure to properly dispose of needle and syringe, and possessing utensils or pipes.
He was sentenced to nine months behind bars per offence, but was again granted parole.
By September the following year, little more than a year after his last court appearance, Jackson was at the helm of Hough Pharma in Australia.
A year later, his father took him to court over the profits.
Greg Hough (pictured) used to live in Queensland but now runs Hough Pharma LLC from Houston, Texas
The multi-national legal battle is being fought across two court cases running in tandem – one in Brisbane’s Supreme Court, and the other in Texas.
In an affidavit tendered in Brisbane’s Supreme Court in May this year, Gregory Hough says he had a verbal agreement with his son to give the US company 75 per cent of the Australian business.
Mr Hough claimed that, before September 24 2021, he spoke with his son on the phone and agreed that he would mentor Jackson and eventually give him ownership of the company when he retired.
In the meantime, Jackson would receive $1 for each two-pack of RATs sold by the company in Australia, $1.50 for each five-pack, and $12.50 for each 25-pack.
In addition, Mr Hough claims he offered Jackson a 25 percent shareholding and asked that the remaining 75 per cent of stocks be sent to his US company.
However, Mr Hough claims his son sent the shares to one of his own companies instead – telling his father it was a ‘workaround’ to get Australian finance and would be reversed.
When Jackson told his father what happened, Mr Hough said, ‘You can’t do that’ – to which his son allegedly told him not to worry and said he would transfer them back on Monday.
In a text message sent to the Hough distribution manager, Jesper Skade, on December 9 last year, Jackson said: ‘Please don’t stress, I’m not cutting you and dad out. That would go against everything I stand for and believe.’
‘I wouldn’t be able to live with myself’.
In Jackson’s version of events, according documents tendered to the court on April 6 this year, the pair spoke on the phone in September 2021 – but he claims the conversation went a bit differently.
He says Mr Hough threatened to cut off his RAT supply unless he received 75 per cent of the company.
He claims Mr Hough said: ‘If you do not transfer 75 per cent of the shares in Hough Pharma to [Hough] Distribution, I will stop the supply of RATs to Hough Pharma and your business will be over and finished.’
‘Are you going to be the son that did this to his father?’ Mr Hough allegedly asked his son.
Pictured: Mr Hough Senior, demonstrating a rapid antigen test on Sky News after they were approved by the TGA
Mr Hough claims he did the groundwork and Jackson would not have been able to sell RATs in Australia without the US company, and had he not convinced the TGA to allow the company to sell Down Under.
But the former electrician says his father is trying to take credit for his work.
Jackson told the court that he would have been able to obtain TGA approval without his father’s company.
According to court documents, Jackson says the Australian branch had ‘modest beginnings’ and that he fronted the $10,000 fee for TGA approval.
Jackson initially ordered RATs from China, via his father’s company, until their relationship fell apart last year and he approached Biohit Healthcare for a direct supply.
Court documents also say he accused his father of lying to the Chinese supplier which ‘may have caused’ Biohit to go back on the supply deal.
Jackson also alleged the US branch of Hough Pharma triggered a $25million slump in Australian sales by blocking tests from China for two weeks in December.
According to court documents, he emailed his father in December last year and told him to ‘man the f**k up’
‘All of these childish acts to assert control are bulls**t.’
Submissions in the Brisbane court state Mr Hough is afraid his son could try to sell Hough Pharma without paying him a stake.
Pictured: Rapid antigen tests, imported from China by Hough Pharma. The business is now worth about $100million
The expat also fears he could be denied control of the business for the lifespan of the market – that is, until people stop buying RATs.
Mr Hough claims he never intended for his son to be the sole owner of the Australian business, but Jackson says it was agreed that he would run the company in Queensland and his father would handle the US side of things.
Court documents say Mr Hough is worried about the way his son is running Hough Pharma because the company was given a $106,560 fine by the TGA in June.
A 75 per cent stake of Hough Pharma has been frozen by a judge until the Brisbane case concludes.
Daily Mail Australia contacted Gregory Hough and Jackson Hough for comment.
TIMELINE: $108MILLION COVID TEST FAMILY FEUD
2014 – 2019: Jackson Hough appears before the court for drug possession.
September, 2020: Hough Pharma launches in Australia.
August, 2021: RATs imported from China by Hough Pharma are approved by the Therapeutic Goods Administration (TGA) for distribution in Australia – triggering an explosion in sales.
September 15, 2021: Hough Distribution LLC, in the US, claims it enters a verbal agreement with Jackson Hough to say it would get a 75 per cent slice of Australian company.
Jackson Hough says that didn’t happen, claiming it was agreed that he would run the business in Australia and his father would run the business in the US.
September 17, 2021: Jackson alleges his father told him: ‘If you want the business to continue, you’ll transfer 75pc (of HP) to me. You don’t have the finances to fund it. If you want the businesses to continue and to continue getting tests into Australia, you’ll transfer the 75 per cent to me. Are you going to be the son that did this to his father?’
November 2021: Jackson allegedly altered the share register of Hough Pharma Pty Ltd but told his father it was a workaround that would be reversed.
December 9, 2021: Jackson told the Hough Distribution co-owner Jesper Skade in a text message: ‘Please don’t stress, I’m not cutting you and dad out. That would go against everything I stand for and believe and I wouldn’t be able to live with myself’.
December 2021: Jackson alleges his father ‘threatened to interfere with Hough Pharma’s supply from Biohit unless’ Jackson transferred 75 per cent of the shares.
December 16, 2021: Son alleged his father stopped all orders of RATs from BioHit in China for up to a fortnight.
Jackson claims Hough Pharma lost at least $25M in revenue due to the stoppage.
December 21, 2021: Jackson sent an email to Greg and Jesper Skade: ‘All of these childish acts to assert control are bulls**t’ and ‘I’m not tiptoeing around anymore’ and ‘Man the f**k up’.
February 18, 2022: Hough Pharma secured deal with Biohit to direct-supply RATs to Hough Pharma in Australia.
April 6, 2022: Hough Distribution LLC sues Jackson Hough and his company in the Supreme Court in Brisbane seeking freeze on transfer of shares.
June 22, 2022: TGA hits Hough Pharma with eight infringement notices worth $106,560 for failing to meet deadlines to give TGA data to show safety and performance of three of its RATs.