The Biotech Investing Penalty Box
Added to the penalty box on 4-April-2014
Reason: Too Promotional
Actinium Pharmaceuticals (NYSE MKT: ATNM) has only been listed on a major exchange for less than a week, yet they are already off to a dubious start. The issue here is stock promotion. The company put out a press release yesterday bragging about how an interview with the CEO will air on Fox Business and Bloomberg TV this weekend. The only catch is that it isn't a real interview; rather it's an infomercial. You can watch it below if you are looking for a good laugh.
I'll make a few serious points about this. First, these things are truly sad because (in my opinion) they prey on investors who aren't appropriate for a stock like this. I've actually received phone calls from relatives because they heard radio commercials by the same promotion firm and wondered if they had just been tipped off to the next cure for cancer. Second, drug development is a very serious business, and that's what Actinium should be focused on. I know raising money is not always easy, but if this is the way the company goes about it, you have to wonder where their priorities lie. Finally, companies should be aware that even dabbling in something like this earns you a first class ticket to the penalty box, one-way. Sophisticated investors who see something like it will never take you seriously again. They will always question your motives, your data, and everything else. It's just not worth it.
Who Am I?
I'm an individual investor from Kansas City. My focus is on biotech stocks, but I enjoy investing in all industries. I'm an old-school, buy and hold investor who believes the best way to outperform and grow capital is to own innovative companies with good management teams over the long-term. more>>