Woe to a world that has The Business Press Maven pontificating on anything I don't know about. So when it comes to either love ... or the legitimacy of a scientific study ... I tend to keep it simple. In love: The Business Press Maven just admits he's wrong. And in reading about scientific research, The Business Press Maven just makes sure the business media mention whether the study they are talking about has a decent sample size and possibly involved a control group. That's not asking the world, is it? Actually, maybe it is. The Business Press Maven read big news this week about AstraZeneca's ( AZN) cholesterol fighter Crestor with undisguised irritation. Here's the first headline The Business Press Maven and many traders saw, a possibly misleading eight words from Reuters: "Statin drug shown to reverse plaque in arteries." Hey, it looked good at first. There's nothing as comforting as a headline about a drug that can help you live a longer and richer life, if you invest as well as ingest. But before we get ahead of ourselves and let an excitable media put a coverlet over our eyes, let's see how they did on the all-important sample size/control group issue. The Reuters story went on to sum up how Crestor was shown to partially reverse plaque buildup in coronary arteries and how that was the first time the AstraZeneca's drug was shown to be effective in that way. Now hear this: From all I've heard, AstraZeneca is a decent company and the drug effective on cholesterol. But if The Business Press Maven's experience on Wall Street and in journalism has taught him anything, it is to always read with an interrogative gaze -- especially when you are predisposed to believe. The first quote we got from Reuters was how the results were "shockingly positive." That quote came from the study's lead author, i.e. not the dude I want putting things in overall perspective. So I skimmed down, looking for information on sample size and control group, and what I got was a few more quotes from the study's author. It was only three-quarters of the way down that someone other than the auteur weighed in, a Johns Hopkins professor who deemed the study "intriguing" but pointed out that more study was needed. From there, we were told that AstraZeneca's shares rose sharply, as if this means anything.
It may: That those who write the news cycle's first stories and traders have a relationship in which they validate each other's misperceptions. But let The Business Press Maven hold your hand through what can be done on the same study, given the capacity for critical thought. The Wall Street Journal's Ron Winslow reported on the issue one day later, and even the headline captured the more complex reality: "Intensive Statin Use May Reverse Course of Heart Disease." (Italics added for dramatic affect.) Winslow rightly called the results of the study provocative, and by the third paragraph tells us that the study involved 507 heart patients who took high doses of Crestor. This was soon described as what it is: a relatively small number. We don't even know whether the regression of disease in this modest little group led to a decrease in disease. No small detail, that. The first quote chosen by Winslow, from the same study author, described the results as "preliminary." Holy Moly Winslow, are you trying to dazzle The Business Press Maven with your basic competency in service to investors? By the sixth paragraph, Winslow mentioned that there was no control group -- even touching upon the very legitimate reason why there wasn't one. (Doctors thought giving a lower dose of drugs to heart patients for comparison sake was unethical.) Granted, we understand there is a qualitative difference between a wire story and what might follow in The Wall Street Journal, arguably the finest business newspaper extant. But while it's understandable that early stories won't be as detailed, you don't have to turn the article over to the author of the study. Point being, one of the things that can harm investors most in this current environment of faster and faster news cycles is just that -- trying to get something out real quick and half-baking it. The bottom line is that an investor trying to cajole the truth out of the facts as they are portrayed in these two articles might come to two very different decisions. That's why The Business Press Maven reads his beady eyes blind to catch these sorts of things and lay them out on a platter for you. If they help you listen to the good reporting out there and avoid the stuff that'll have you riding your portfolio off a cliff's lip, then I'll feel like a lucky little Maven, St. Patrick's Day or not.
Speaking of sample sizes, one of the most over-reported nonbidding wars is over. The Business Press Maven was going to escape to Wildest Borneo if he had to hear again how a bid or bids for Knight Ridder ( KRI) would show whether there was still value in newspaper. Uh, maybe true if a good number of bids came in, but if one or two (in this case one, from McClatchy ( MNI)) companies were willing to bid, does that affirm any legitimate sense of value? In matters of the heart, even The Business Press Maven knows having one love can serve you well. But in the open market? Well, at least we found something that can make a 507-patient study look a touch more thorough.