Geron Short Closed After Latest Drop

The hate mail poured in when I discussed my Geron(GERN Quote) short recommendation last week, so what will my inbox look like now that I've closed out the Geron short after the stock took another dive Wednesday?

With Geron shares down 11.4% to $5.74 Wednesday, I alerted subscribers to my Biotech Select investment newsletter that I was covering the Geron short recommendation that started on Jan. 26. The final return on the short recommendation was 25%.

The reason for the dive in Geron's stock price Wednesday was the publication of a medical paper detailing the case of a boy with a fatal brain disease who was treated with an experimental concoction of fetal neural stem cells. These fetal stem cells caused benign tumors to grow on his brain and spinal column.

The case was reported last night in the medical journal PLoS Medicine and can be downloaded here. An MSNBC story on the boy can be found here.

This tragic case had nothing to do directly with Geron. The boy was apparently treated with neural stem cells at a clinic in Moscow. He was not enrolled in a clinical trial involving Geron or its stem-cell drug GRNOPC1.

Geron recently received permission from the Food and Drug Administration to begin its own phase I safety study of GRNOPC1 in patients with complete spinal cord injuries. Geron executives have stressed that the company has data showing that GRNOPC1, when injected into rats, does not cause tumor growth.