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Biotech / Medical : GUMM - Eliminate the Common Cold -- Ignore unavailable to you. Want to Upgrade?

To: Guy who wrote (295)	2/12/1999 10:44:00 AM
From: DanZ	Respond to of 5582

Guy, My guess is that OTC products are primarily self-policed by competitors. If a company makes claims that a competitor feels is unsubstantiated, legal action can be taken in an attempt to halt such claims. As an example, I read recently that Warner Lambert brought to the attention of the court, that Breath Asure, Inc was making alleged false and misleading claims with regard to Breath Asure capsules (NOT Breath Asure Gum). Quoting from the press release: Warner-Lambert took the legal action to protect consumers from false and deceptive claims because it feared that products promoted in a false and misleading manner could ultimately undermine consumers' confidence in all breath freshening products prnewswire.com If a competitor feels that GelTech is making false and misleading, or unsubstantiated claims with regard to Zicam, I would expect a competitor in the OTC cold remedy market to ask GelTech to stop making such claims. If they fail to stop making the claims, presumably because GelTech believes that their claims are valid, then the competitor can file a complaint with a court and a judge will decide if the company can substantiate their claims. BTW, I don't think the ruling against Breath Asure has any negative implications to GumTech, or to Breath Asure's relationship with GumTech. The injunction was only for the capsules and neither the judge, nor Warner Lambert, alleged that Breath Asure made misleading claims with regard to their gum product. You might notice that Breath Asure, Inc. has already complied with the courts ruling and reworded claims on their packaging, web site, and other advertising media. Dan

To: Guy who wrote (295)	2/12/1999 11:46:00 AM
From: DanZ	Read Replies (4) \| Respond to of 5582

I'm always concerned when the only analyst who follows a particular security also makes a market in the security. Because of this, I did some research at nasdr.com to see if any complaints have been filed against GunnAllen Financial. What I found was that only two complaints have been filed against GunnAllen since 1994, and both were small awards that were unrelated to their research, recommendations, or market making activities. The text of the file that I received from the NASD follows. I'm sorry for the caps but that is how the report was delivered to me and I didn't want to alter it. As I have said before, when I am deciding whether to hold a stock for a period, as opposed to a day trade or short term hold, I try to cover as many bases as possible. Given that GunnAllen makes a market in GUMM, and has historically traded the most stock of any other market maker, I thought it was important to look into their reputation. Obviously the NASD file doesn't tell everything, but it does give me confidence that their customers don't have many complaints that they thought were important enough to file with the NASD. Dan MEMBER FIRM: GUNNALLEN FINANCIAL, INC BD NUMBER: 17609 NASD Member Firm: GUNNALLEN FINANCIAL, INC BD Number: 17609 2/11/99 SUMMARY INFORMATION 2/11/99: 6/23/95 NASD ARBITRATION GUNNALLEN FINANCIAL, INC. WAS NAMED IN AN NASD ARBITRATION AWARD. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER AND WAS FILED ON 1/13/94 ALLEGING: ACCOUNT RELATED-BREACH OF CONTRACT. THE AWARD INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER $1,000.00, AMOUNT AWARDED TO CUSTOMER (PARTIAL OR FULL) $1,000.00; INTEREST, AMOUNT ASKED BY CUSTOMER $0.00, AMOUNT AWARDED TO CUSTOMER (PARTIAL OR FULL) UNSPECIFIED. [NASD ARBITRATION CASE NO. 93-04871] 2/11/99: 2/04/94 NASD ARBITRATION GUNNALLEN FINANCIAL, INC. WAS NAMED IN AN NASD ARBITRATION AWARD. THE ARBITRATION INVOLVED A PUBLIC CUSTOMER AND WAS FILED ON 5/11/93 ALLEGING: ACCOUNT RELATED-DIVIDENDS. THE AWARD INCLUDED: ACTUAL/COMPENSATORY DAMAGES, AMOUNT ASKED BY CUSTOMER $423.02, AMOUNT AWARDED TO CUSTOMER (PARTIAL OR FULL $423.02 JOINTLY AND SEVERALLY; INTEREST, AMOUNT ASKED BY CUSTOMER $0.00, AMOUNT AWARDED TO CUSTOMER (PARTIAL OR FULL) $157.98 JOINTLY AND SEVERALLY. [NASD ARBITRATION CASE NO. 93-01058]