The best part about Berkshire Hathaway CEO Warren Buffett's annual investor letters is that they always provide some kind of reality check.This year, in one sentence, he takes on one of the biggest diversion tactics of all -- one promulgated by many companies as the way they should be viewed, and then gullibly accepted by investors: EBITDA or earnings before interest, taxes, depreciation and amortization."When Wall Streeters tout EBITDA as a valuation guide, button your wallet," he wrote.Here's the windup to that comment (emphasis added by me):"I won't explain all of the adjustments - some are tiny and arcane - but serious investors should understand the disparate nature of intangible assets: Some truly deplete over time while others in no way lose value. With software, for example, amortization charges are very real expenses. ..."
An epic month of biotech stock performance ends with a significant sell off.
One should at least question the reasons behind the super-sized confidence in certain assets.
Solar and biotechnology stocks have had a long run, but these stocks might not be ideal for new money.
The promised growth from a spinoff of AbbVie has not materialized.
Array is partnering with AstraZeneca and Novartis on a number of cancer drugs with trials soon getting underway that could transform the company by year end.
If history repeats, investor optimism for NewLink's phase III study is misplaced.
InterMune's Esbriet improved lung function and delayed disease progression in pivotal phase III study.
An investor short Endocyte explains his negative view on the upcoming European approval decision in ovarian cancer and why the lung cancer study is likely to fail.
The No. 1 stock on this list has more than half its float short.
Sales of the prescription fish-oil are so low that generic drug makers may simply pass the product by.
A just-published academic paper on multi-level marketers supports the notion that the multi-level marketing industry has a serious unresolved issue or two.Before you go dismissing this as just another academic paper, consider the authors: FTC senior economist and pyramid scheme expert, Peter van der Nat and Bill Keep, dean of the business school at The College of New Jersey. In 2002 they co-authored a highly regarded paper explaining what differentiates a legitimate multi-level marketer from a pyramid scheme.In this piece, which doesn't pick on any company in particular, Van der Nat and Keep give an exceptionally well-spelled-out history of multi-level marketers, but then dive into the deep-in-the-weeds legal decisions and "continuing concerns."Perhaps nothing in the paper is more compelling to multi-level marketing aficionados as their discussion of internal consumption. This is when distributors get compensated for sales to themselves and other distributors. A key issue in the debates on Herbalife, Nu Skin and others is how much compensation comes from internal consumption vs. genuine external sales.
The decision to change out the primary and secondary endpoints was made as part of discussions with the FDA, a Vertex spokesman said.
Biotech columnist Adam Feuerstein answers readers' questions about health care companies.
Biotech investing goes mainstream.
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