Hi Mad2, thanks for the 1 in 20 chance; that's a lot more than we have heard around here. LOL I would like to answer some of your post but keep in mind that many of us believe that the New England Journal of Medicine will actually publish the clinicals. People are certainly welcome to short based on the opposite belief but realize that several cold-related studies have been published recently (Tremacamra, pleconaril) but the difference between those and Zicam is that Zicam is on the shelf should the study come out (no need for others to post that those are not scams, thank you). Tremacamra has a lot of reasons why it won't be manufactured (I can explain but it is not germane), but suffice it to say Boehringer has stated publicly that they won't produce it. VPHM's drug has its place potentially but it is a prescription drug that might only be used in very sick patients and only for marginal effect. Shorts are right; it ain't no $2 Billion dollar drug (LOL). No way.
Do not underestimate the power of the medical journals' own publicity machines. When the Tremacamra study came out (and it is probably better for the common cold than pleconaril),it was all over the press and the WSJ - only no body was or is going to make it. When there is a product on the shelves in all the stores mentioned and a story comes out, then the stock will most likely enjoy a fast rise. Add the high short percentage and it could go higher. If people really believe the product is a scam and nobody will publish their study, then go ahead and take a short position. I think that GUMM is confident that the study will be published so a lot of publicity will be free. Also, a recent AdWeek mentioned a prominent Beverly Hills Agency that will be doing publicity. They are going with the best. You may argue that they cannot afford it, but on the other side are the high profit margins and the fact that the company thinks academia will embrace the product (as did Dr. Seidman) and generate a lot more free publicity in the beginning than almost any company, big or small, could generate, by tweaking all the news (rather than commercial) media.
Your 1 in 20 chance scenario not only doesn't take into account the free publicity, but you are discounting the possibility of nicotine gum production becoming a reality this year. There is a global market for it (except Singapore -LOL) and recall that SKB's patent expired this year, opening the door for generics.
You state that GUMM owns "only 60%" of GelTech but is taking on 100% of the risk. WHile that is not entirely true, I cannot argue with the gist of your point there. On the other hand, the high profit margin of Zicam, IMO, makes that worthwhile.
While some of your questions regarding production and cash flow do merit an answer, and I will see if they can answer them at the shareholder meeting next month, I think there are a lot of things that are compelling reasons for not going short. Hey, someone on yahoo suggested they could make enamelon gum now that the Journal of Clinical Dentistry has published peer reviewed studies on it. biz.yahoo.com LOL. I guess those "scammers" (not my real feelings) found some shill academicians to publish their "fraud" (not my feelings). I guess it still must not be true <vbg>.
Anyway, Zicam is not the only issue with GumTech and the new management is not the same as the old. |
