Penumbra Drops on Short-Seller Note Claiming Fraud

A short-seller charged in a report that Penumbra created a fake doctor to author research reports. The medical-device maker denies the claim.
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Penumbra  (PEN) - Get Report shares dropped on Tuesday after short-seller Quintessential Capital Management said the scientific literature produced by the medical-device maker  appeared to be authored by a "fake character."

“This fraudulent character appears to have been fabricated by management in a reckless attempt to hide its involvement with critical research produced with significant undisclosed conflict of interest,” the report says.

Penumbra, Alameda, Calif., responded to the allegations by telling CNBC that the claims made in the report were "baseless."

The report says the "conflicted research has been used multiple times to market Penumbra’s products to healthcare providers around the United States and elsewhere, to support [Food and Drug Administration] applications for its devices clearances and to promote its stock before and after its initial public offering."

Quintessential says that photographs of a Dr. Antik Bose, the person claiming to author the reports, are either doctored or belong to unrelated persons. 

The firm's investigation into Bose's credentials also came to a dead end, according to Quintessential. 

Bose is "a fake internet persona ... put together by Penumbra in order to distance its executives" from "conflicted scientific research papers promoting its devices," Quintessential's note says.  

Penumbra shares at last check dropped 11% to $199.43. They have traded today down as much as 18% at $182.62. The stock's 52-week low of $121.80 was set in mid-March, and its 52-week high of $277 was set at the end of October.