This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

As Keryx, Aeterna Shares Surge, Investing Writer's Credibility Questioned

Updated with new information and a response from Jeremy Richards.

NEW YORK ( TheStreet) -- Shares of Keryx Biopharmaceuticals (KERX - Get Report) and Aeterna Zentaris (AEZS - Get Report) soared March 5 after an article touting the prospects of the drug companies was published on the investor Web site Seeking Alpha.

But the credibility of the author, Jeremy Richards, and the veracity of claims and statements made by him, couldn't be verified by anyone at his purported investment firm, the drug companies and Seeking Alpha.

Richards is the writer of 14 Seeking Alpha articles over two years promoting Keryx, Aeterna and the experimental cancer drug perifosine that both companies are jointly developing. Richards' latest article on the two stocks was published March 2. Richards called perifosine's Food and Drug Administration approval "practically a done deal" and predicts positive results from an ongoing colon cancer clinical trial.

Keryx, based in New York, is expected to announce top-line results next month from a phase III study of perifosine in advanced colon cancer. The trial is likely to fail based on poor phase II data as well as a proprietary analysis correlating the low market values of cancer drug developers with high failure rates for phase III cancer drug trials.

In response to Richards' article, Keryx shares jumped $1.24, or 33%, to $4.94 in Nasdaq trading March 5, adding $100 million to the micro-cap company's market value. Shares of Quebec-based Aeterna rose 40 cents, or 23%, to $2.15, adding $33 million in market value.

Neither company released news that would have propelled the shares. Keryx last released a media statement Feb. 29, when it said its 2011 loss widened while its cash holdings increased. Aeterna last published a release Feb. 3, an update on a phase I prostate cancer treatment.

Investors in little-known biotechnology stocks follow professionals for insights on what's often complex scientific information. Keryx and Aeterna aren't followed closely by Wall Street analysts, and most mutual fund managers don't hold stocks that cost less than $5, as the two drug companies do.

Richards describes himself as the manager and director of Private Wealth Fund with "twenty years investment experience," according to his Seeking Alpha profile. That helps explain why his Keryx and Aeterna analyses seem so well-received.

But Richards may not be the investment pro he claims to be. Reached March 2 by phone, Peggy Gan, CEO of Private Wealth Fund, a California-registered limited liability corporation, says she has never heard of Richards.

"I don't want to cast aspersions on the guy but no one named Jeremy Richards works for Private Wealth Fund," Gan said. She also said she had no knowledge of any articles published on Seeking Alpha.

After this story was published Tuesday, Richards altered his profile on Seeking Alpha, which now says he is manager and director of "A Private Wealth Fund." Richards added an "A" and kept the rest capitalized.

Richards didn't respond to a message sent through his Seeking Alpha account, but he did post a comment Tuesday under his most recent Seeking Alpha story:

"In response to Mr. Feuerstein's uninformed, inflammatory and accusatory comments which are completely without merit. It is rather sad that the [sic] allows such publications by 'tabloid' journalists. Firstly, I run 'A' Private Fund, not the California LLC Mr.Feuerstein mentions. It is 'Private' and due to moral and professional considerations, I will not discuss the specific investors and/ or funds in the fund," Richards wrote.

Seeking Alpha has started a "dispute process" with Richards. He's being asked to provide documentation to confirm the veracity of his Keryx and Aeterna articles, according to George Moriarty, managing editor of Seeking Alpha.

"The process is ongoing," Moriarty said. "We will investigate any and all disputes registered against articles published on Seeking Alpha."
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AEZS $0.09 3.33%
KERX $3.47 7.43%
AAPL $111.96 1.10%
FB $93.35 -0.70%
GOOG $649.00 1.20%


Chart of I:DJI
DOW 16,790.19 +13.76 0.08%
S&P 500 1,979.92 -7.13 -0.36%
NASDAQ 4,748.3610 -32.9030 -0.69%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs