Saturday, June 13, 2009


HEB message boards are gettings tons of chatter, most of it garbage, but it's usually emblematic of a pivotal inflection point in the share price, either up or down. Longs are expecting FDA approval of Ampligen for treatment of Chronic Fatigue Syndrome (CFS), a recently diagnosed debilitating medical condition. Patients and doctors swear by Ampligen's efficacy, despite the disease being marginalized in the past by the mainstream medical community. Now that CFS is recognized by the FDA, Ampligen's approval as an orphan drug (there are no other CFS treatments approved simply because CFS wasn't formally recognized as a disease) should be a blockbuster, according to long investors.

Ampligen has also been deemed effective as an adjuvant to flu vaccines in Japan and other countries, so the share price has spiked up in the last month from depressed levels. It has also been effective in clinical trials for boosting the efficacy of cancer vaccines in clinical trials. As Dr. William Carter, CEO of HEB stated in an interview last night, which is causing the uproar: "We have multiple shots on goal." See the June 4 blog on the swine flu.

Doubters (and shorts) will point to HEB's checkered history of FDA non-approvals and share dilution (altho HEB does already have one commercially approved drug for Alferon).

The pumping and bashing will continue unabated over the weekend, and the old adage "volume before price" will inevitably be proven again, as HEB will continue its high price volatility going into Monday.

HEB is a risky and volatile play. Do your due diligence. This is not a recommendation.

Disclosure: I am long HEB.

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