The Scrying Biotech Regulatory Bias Index

Regulatory Bias Index

To understand how this works, I encourage you to read the article in which I introduced the concept which you can find here.  What follows is a brief excerpt.

This index is essentially a spectrum of subjectivity running from the malignant on the left to the benign on the right. I know that some of you will argue that to be human is to encompass all of those qualities on the far right side of the page, but for me, these are more divine attributes. Placing a product within this spectrum is done by assessing how much of an impact it will have on the ruling paradigm. In other words, FDA representatives, since the PDUFA act of 1992 depend on large-cap pharmaceutical companies for their very jobs, and consequently, are likely to subconsciously produce judgments in their favor. It is, therefore, wise to note how many companies could be materially affected by a favorable decision and to what extent they would be materially affected.

So, where on this spectrum is the FDA as a regulatory body? Well, my answer to that question would be, like most of us, all over the expanse of it at any given time based upon the circumstances presented.

Please keep in mind that this is only one aspect of this (drug approval) process. The science under girding each application rightly occupies center stage in our thinking. But to deny the fact that the FDA is now more akin to a bureaucratic oligarchy than a democratic institution is foolish at best. And the consequence of this is, at the very least, an opening of the door to subconscious manipulation of otherwise well-intended agency representatives.

Always be well…


A Word About Zafgen (ZFGN)

I’ve made a few mistakes in biotech this past year.  Most notably my disregard for the financial imperatives facing NovaBay (NBY) and my reaction to the head-fake that Synergy Pharmaceuticals executed on the hiring of the former Shire PLC executive as being demonstrative of a possible buyout.  Lessons learned!

While I don’t want to triple down on those mishaps by chasing a falling star, or in the more common parlance of finance – catching a falling knife, I am going to be buying shares of Zafgen (ZFGN) tomorrow morning if there is no news of a positive nature, or in the wake of news regarding something catastrophic.  In the instance of no news, I’ll be doing this because my reading of the situation indicates that this cancellation of the recent roadshow appearance is likely due to a positive partnering opportunity and not some failure in the clinic.

If, however, there is bad news, I’ll be buying the dip in part because the share price has already been punished by un-grounded investor fear, and because most equities that experience a clinical trial failure bounce as high as 40% off bottom if there are a number of other pipeline opportunities in place.

Obviously, if positive news is released this morning, I’ll leave the stock alone.

Always be well…

Scrying Biotech Endorses Bernie Sanders For President

Bernie Sanders

Scrying Biotech is acutely aware that Wall Street, and specifically the biotechnology sector of the stock market is poorly regulated when it comes to the interests of retail shareholders.  We are lied to, mislead, and kept in the dark regarding information crucial to making an informed investment decision.  As a result of this, I’m looking for candidates from both major parties that are willing to confront Wall Street directly.  I’ve already mentioned Donald Trump’s desire to bring hedge fund managers to account for paying their fair share of income taxes.

Tonight, at the first Democratic debate, Bernie Sanders stood out from all the rest in his desire to reign in the excesses of Wall Street that lead inevitably to the failure of our economic system.  Consequently, Scrying Biotech fully endorses Bernie Sanders for President of the United States.  The why of this endorsement can be summed up in this quote from Sanders at the CNN Democratic National Debate held on October 13th of 2015.

Let us be clear, that the greed, recklessness and illegal behavior of Wall Street, where fraud is a business model, helped to destroy this economy and the lives of millions of people.  Check the record!  In the 1990’s, in all due respect, when I had the Republican leadership and Wall Street spending billions of dollars in lobbying, when the Clinton administration, when Allan Greenspan said what a great idea it would be to allow these huge banks to merge, Bernie Sanders fought them and helped lead the opposition to deregulation.

Today, it is my view, that when you have the three largest banks in America are much bigger than they were when we bailed them out for being too big to fail, we have got to break them up.

Congress doesn’t regulate Wall Street.  Wall Street regulates Wall Street.

The truth of the matter is that not only must Glass Steagall be re-instituted but comprehensive regulatory reform of Wall Street must take place to protect our economic system and retail shareholders like you and me.

Michael Webb

Ocata Therapeutics Is Heating Up

Ocata Therapeutics Heating Up

Investors: as many of you know, I’ve penned a long-thesis for involvement in Ocata Therapeutics, stock ticker symbol OCAT.  You can find that here.  Since the article was published on Seeking Alpha which, among other things, gave voice to the criticisms of the company, another contributor going by the name, Mako Research, published his 2nd 1-sided harangue in about a 1-month period of time.  His 1st article was a 9,000+ word diatribe that had an inverse effect on the stock price.  Investors simply weren’t buying what he was selling – fear and panic.  His 2nd article, a desperate attempt to gain control of the stock price was chalk full of more lies and distortions.  I’ve addressed 2 of these in the illustration above.

From my perspective, it’s important to remember the words of Seeking Alpha biotechnology editor Mike Taylor as he was introduced in April of last year by senior editor George Moriarty.  He was then quoted as saying this concerning his article submission expectations.

I’m biased in favor of analysis that considers the opposite side of an argument – a bull piece that gives careful attention to the bear case and vice versa.

My question to both Mike Taylor and George Moriarty is this: where was there even a hint of objectivity in either article by Mako Research?

Furthermore, I’m constantly reminded by the editorial staff to keep things professional and to always be collegial.  How is it that a writer can be allowed to use adolescent expressions like shareholders are “getting hosed” and then tear down the integrity of a fellow analyst unjustly without be held accountable in the editorial review process prior to publication?

Speaking of fellow analyst, Boris Peaker, Mako Research said the following…

The analyst who wrote the report is Boris Peaker, who has what I consider one of the worst track records I’ve ever seen on the sell side.

Later, he suggested that “where I’m from, any professional with a track record as bad as (Peaker’s) would immediately be fired.  Here’s Boris Peaker’s track record on

Boris Peaker Tip Ranks

It’s certainly not worthy of such harsh treatment and favorable to Mako Research’s TipRanks record found here.  Though Mako’s comments fall under the heading of opinion, and out of the realm of collegiality, they are certainly an anathema to what Seeking Alpha has suggested is their minimum publication standard.  It appears to me that there’s a good deal more editorial latitude given to writers espousing a short-thesis than to those articulating a long-position.  This feeds into a larger truth regarding life and living – that it is easier to tear something or someone down than to build them up.

Always be well…