Rick,
Thank you so much for this information! Thank God for the internet and Silicon Investor which is giving us a forum to piece together this puzzle. I doubt any one of us could get a real handle of what has been going on, but by pooling our talents together we might have a chance of taking on the Seven Dwarfs.
I would normally be hesitant to charge Rhodes with intentionally trying to sabotage the company. Intentions are difficult to prove and I would normally feel uncomfortable about leveling charges of malicious intent. Under other circumstances I would dismiss Rhodes as merely incompetent and not malevolent. However, a number of things lead me to believe that you may be right in your charge that Rhodes, Reilly, and perhaps other Board members may be intentionally destroying the company.
1) The Board was reluctant to hold a stockholders meeting and only held one when a judge's decision to order a meeting was imminent.
2) The meeting only lasted an hour and the format of the meeting was designed so that investors could not ask repeated questions and followup questions. The format was desinged to allow Rhodes and the Board members their best chance to evade hard questions from the shareholders. It is obvious that they did not want their actions examined in the light of day.
3. This company had so much going for it. I can't prove that it was intentionally sabotoged, but it is hard to believe that anything other than intentional sabotoge could have brought it down so hard and so fast.
4. I did not understand the doubletalk answer that Rhodes gave to my question about the great Ah ImmunoAssay giveaway. Perhaps this lack of understanding is due to my limited intelligence. But I believe that if Rhodes had a reasonable explanation to this situation he could have done a better job of making himself understood. In any case, the format of the very short question and answer session was designed to hinder the stockholders from understanding what was going on, so if people misunderstand their answers Rhodes has no one to blame but himself. What could the ImmunoAssay giveaway be, other than intentional sabotage?
5) I think I did a pretty damn good job of demonstrating beyond a shadow of a doubt that PRLN's lawsuit against Babish is without merit. I can only surmise its purpose is to gag him so that he can't tell the stockholders what was done with their money. I don't know if any of you had time to go through my analysis of the case. I must admit it was very long. But if any of you read it and found any flaws in my thinking, please point them out to me. I think my analysis is solid, but I may not be the most objective observer in weighing its merit. If any of you found flaws in my argument I want to know about them.
Rick, it is obvious that your source knows a lot about PRLN. You wrote something that convinces me that he follows the company VERY closely:
Things got from bad to worse. A very exciting prospect had come up. The possibility of Chinese compounds as cosmetics. Campbell had apparently some promising leads in this area. He even met with Newskin and they were so excited about the prospects they gave him $40,000 to start off a collaboration to study the cosmetics. Even more attractive is that such products only need to be proven safe (noty efficacious like drugs). Rhodes completely ignored this tremendous potential.
The possibility of using Chinese herbs for cosmetics is a little known business plan of the company. I don't think it was mentioned in any of the annual reports. However, an information packet dated March 22, 1995 was given to stockholders at the 1995 annual meeting. It states:
Paracelsian will fund the expense of drug discovery by; establishing a near term revenue stream from a OTC product line. Paracelsian initially will develop dermatalogical formulations that use herbal extracts identified in its drug discovery program as having anti-proliferative activity. Several such herbs already have been identified. Due to lower regulatory hurdles, the Company expects to develop its first OTC product, a dermatological formulation for the treatment of psoriasis in the 1996 fiscal year.
I've skimmed through the 1993 - 1996 Annual Reports and could not find a mention of this plan for a dermatological treatment for psoriasis. It might be in the reports and I might have simply missed it. But I think it's more likely that the plan for developing cosmetic and dermatological products is a little known incident in PRLN's history. If this is the case, then your source really knows his stuff.
I do not know if we have enough evidence to prove beyond a reasonable doubt that Rhodes and others intentionally sabotoged the company. I think there is enough evidence that this possibility is more likely than not. If it walks like a rat and it looks like a rat and it hides in the shadows like a rat and it smells like a rat, then it's a rat.
Robin |
