My Latest 35% Gain In One Day Winner: Why Hemispherx Biopharma Is Rubbish

TIMalert subscribers know I think the guys running HEB are scumbags–they’ve done 2 financings at massive discounts to the market price (showing no regard to their shareholders because they KNOW the shareholders are nitwits so screwed they deserve to be!) in the past few weeks by taking advantage of their pumped up stock price based on PRs detailing YEARS OLD DRUG DATA.

I shorted 300 shares at $4.18 at 10:20am on Friday, sending this alert out to TIMalert subscribers:

Shorted 300 HEB at 4.18, very small speculative position…found the shares through Thinkorswim, have 700 more reserved and I got up late so I’m guessing there are many more shares out there…I think I can make $1-2 of downside from here, but I’m keeping it small since the stock is still up on the day…biotechs are jumpy and if you read thestreet.com’s article on this carcass, you’ll see this company ain’t worth its hype

I’m still holding my miniscule position because the size doesn’t matter, it’s the great feeling of being right (already up nearly $1.50/share on my short) and my desire to rub it into those gullible/ignorant enough to believe the BS/hype….after all, this slumdog is up from 50 cents/share just one month ago!

There will always be new suckers, but I intend to create such a ruckus in the coming years (not saying these stocks aren’t good to buy, obviously the upside is nice…I want you guys to learn to buy the hype, just never believe it!) that every long-term penny stock investor sucker will know that Timothy Sykes warned them before they did the dumb thing that lost them so much money.

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Adam F. of TheStreet.com explains what this pump and dump is all about–and contrary to the pimple-faced-snot-nosed kids and boobs posting on Yahoo Finance, the article came out at 8am, plenty of time for everyone who knows how to read to go short this pile of junk (it was reposted after my 10:20am alert, thus giving rise to the theory that Adam and I are in cohoots)…the problem obviously stemming from the fact that most people “invested” in HEB don’t know how to read…seriously…and have dreams of being invested in DNDN, VNDA, MAPP-type moves. While that very well may happen, the signs of blatant manipulation and pumping make me believe the odds are very high to be short here and I’m perfectly positioned with my ultra-small position to reap the rewards of probable further downside come Monday.

Here’s Adam’s fact-based article, facts are which the promoters and suckers are sorely lacking:

Erik D.M. writes, “Hey mister journalist, still feeling the same about Hemispherx Biopharma(HEB Quote) as you did a couple of days ago? I don’t see you writing anything negative anymore, or did you buy them yourself, too?”
Nope, I still feel the same way about Ampligen — a long shot for U.S. Food and Drug Administration approval as a treatment for chronic fatigue syndrome.

I assume Erik is taunting me because Hemispherx’s stock price is higher today than it was when I wrote my column on May 28. Well, Hemispherx’s CEO William Carter has helped his cause by hooking up with some online penny-stock promoters who’ve been flogging the stock incessantly.

The company has also fed the maws of risk-hungry retail investors by issuing a couple of hyper-promotional (but largely content-free) press releases related to Ampligen’s role to potentially treat avian and swine flu strains.

But so far, nothing from Hemispherx about the pending FDA approval decision on Ampligen. All of Carter’s bluster is designed to divert attention away from the real matter at hand, but he can only stall for so long.

And he still hasn’t answered any of the questions I posed to him in my last column.

What Carter is doing instead is taking a page from the well-worn playbook I’ve seen used countless times by companies in trouble with the FDA. In fact, Hemispherx reminds me so much of Biopure(BPUR Quote), the old human blood substitute company. That story ended badly, and so will Hemispherx.

I’ve already catalogued several inconsistencies in past statements made by the company about the clinical data coming out of Ampligen’s clinical trials. Carter’s track record hyping Ampligen is no better. Check this out:

On Hemispherx’s March 19 conference call, Carter spoke about the strong prospects for Ampligen’s approval. To back up his claim, he quoted a report from the Agency for Healthcare Research and Quality (AHRQ), a U.S. government-run organization, which stated that “Ampligen, an investigational drug that is not approved by the Food and Drug Administration, given intravenously to severely debilitated [chronic fatigue syndrome] patients yielded the most promising results.”
Ampligen is “most promising,” according to the AHRQ, an arm of the federal government. It’s a claim you hear Carter make often.

I found that AHRQ report, thanks to the Google. It was published in September 2001 — almost eight years ago. The “most promising” line about Ampligen is in the report, for sure, but it refers to the small Ampligen study done in 1993-1994, not the pivotal study of the drug conducted in 2004.

The report also states that, “In sum, evidence from trials involving immunologic therapies was relatively scant and insufficient to conclude whether these treatments were effective or ineffective.”

Not such a ringing endorsement, but then, Carter doesn’t want investors to know that, nor does he want them to know he’s quoting from an outdated report compiled eight years ago.

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