Howdy. How did you get info from the VC, who is the VC and what did you learn that caused you to doubt him or her? It will be exciting to get some new info on this thread.
I think the truth is in the medical information, the test results and the results of the approval in Mexico. The drug is not significantly more effective than a placebo. It doesn't really work. The press has greatly exaggerated the value of the drug and its financial potential.
There was a lot of fanfare about approval in Mexico, but the sales there have been negligible. The first quarter there, the channels were filled and it looked like great sales, but then no more sales the second quarter and negative sales in the form of returns the third quarter. The drug isn't selling well at all in Mexico and I don't think it will sell anywhere, since it doesn't work.
The stock price went up on the Mexico approval, but didn't go down when the sales proved poor. The stock went up on potential approval in other countries, like UK, and it didn't go down when the approval didn't occur. The stock price went up on the news that SGP will manufacture the drug if/when it's approved in the US, but there has been no approval in the US. When there was news that they are working on a female version while no other company has one, the stock price went up, but they have not even completed trials and may never have an approved female version, plus VVUS, which has a product that works, has gotten a patent on a female version for their own drug. With all that, the stock price didn't drop commensurately after rising on the news of their working on a female version. So every time there's a news release about potential, the stock price goes up, but when the potential fails to materialize the stock price doesn't go down commensurately.
For that reason, I think it's highly inflated and that some day the truth will catch up with it. I think there's a fair chance the US will not approve the drug for use and a very strong chance that if it's approved it will not sell. So eventually, the stock should fall hard. I have a small short position, which I'd like to increase at the current stock price.
You and I hold a few long positions in common by the way.
Linda |
