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Hemispherx Builds False Hope on Old Data

In today's Biotech Stock Mailbag, I write about how the CEO of Hemispherx Biopharma (HEB - Get Report) regularly uses a government report written eight years ago to assure investors that the company's chronic fatigue syndrome drug will be approved soon.

On Thursday, Hemispherx's William Carter went back to the future again.

This trip in the wayback machine resulted in a press release from Hemispherx touting a "new peer reviewed publication" that calls the company's drug Ampligen "the most promising adjuvant candidate for mucosal vaccines."

But while the press release carried a June 4 dateline, the study highlighted was actually published in March.

The publication of this Ampligen study was so important that it warranted a press release, yet Carter sat on the news for three months.

The evidence is mounting that Carter is seeking to divert investors' attention away from the delayed approval of Ampligen as a treatment for chronic fatigue syndrome. The U.S. Food and Drug Administration was supposed to announce its decision May 25, but on May 26, Hemispherx said the FDA asked for a "brief delay" of one to two weeks.

Since then, Carter has spent a lot of time changing the subject -- issuing three press releases in seven working days touting Ampligen as a potential flu vaccine booster. Hemispherx is just one of a chorus of small drug companies seeking to may hay from the recent outbreak of the H1N1 virus.

The article highlighted in Thursday's release was published in March in the online edition of Therapeutic and Clinical Risk Management, an open access research journal. The study itself is not so much new scientific work as it is a review of previous clinical work on flu vaccine boosters.

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