Biotech Stock 'Hate' Mailbag: Readers Riot Over Galena, Prana

NEW YORK (TheStreet) -- The Hostile React-o-Meter has been spinning out of control and my email inbox and Twitter stream are filled with angry people. Welcome to a special Biotech Stock "Hate" Mailbag.

Mark R. writes:

You have to realize by now that you have a dimishing impact when it comes to moving pps [price per share]. It is almost a joke within the biotech investors that your picks are a long play the next day after our come out with your bs [bullshit] articles.  Before long you will not even get one day of price action and you will become a contraian play on the news. PS -- Rogaine is over the counter and based on you and Cramer I would think you could get a two for one deal! [All emails posted as received, no corrections made to spelling or grammar.]

The "you're bald!" insults don't deliver the same sting they did in the 1970s.

I do have one serious point to make about Mark's note. I don't write for day traders. I don't interpret charts. I have no idea what Stock XYZ is going to do in the next hour or the next 24 hours. I don't really care. This notion that you can judge the accuracy of my biotech calls based on the direction of the stock the day, or the day after, I publish is silly.

Let's say I write a column analyzing previously published phase II study data and other factors and use all this information to make a prediction about the outcome of an ongoing phase III study. In this column, I conclude Drug X is likely to fail, but later that day, shares of the company developing Drug X are higher. One week later, the stock is worth even more. By Mark's logic, my call is wrong.

Nonsense. I'm focused on the outcome of the clinical trial, which is months, maybe years, away. Between today and the release of the study results, the stock may trade up, down or sideways for any number of reasons, none of which concern me much unless the fundamental thesis changes. Hopefully, when the study results are eventually announced, the work I did earlier trying to predict the outcome correctly pays off.

Biotech timelines are lengthy, resisting the short-term demands of "Insta-Twitter" and the now! NOW! NOW!! stock-trading mindset. I understand traders are going to trade and there's money to be made in that interregnum between the start of a clinical trial and the outcome. (Same goes for FDA drug approvals.) If this is your thing, best of luck to you. Just realize I'm not really writing for you (although I hope you find value in what I say, too.) I'm writing for the last guy holding the stock before the drug trial results are announced. Hopefully, whatever call I made is correct. If not, I'll admit my mistakes, learn from them, and try harder the next time.

"Not Stupid" writes:

How about you learn to report facts and stop trying to bash so many companies. I do my DD [due diligence] and hold on to my shares of companies after you come out with facts twisted to your favor. Everytime [sic] I hold through your scams and make money. But have seen many a time where you ruin companies. Do not know how you sleep at night when I find facts that you do not mention that are positives -- all you think about are the negatives. When I first started trading I use to watch your cronie [sic] Cramer on TV and read articles at TheStreet -- more like lets [sic] see how many weak hands we can shake out today. People are starting to wise up to you and your credibility [sic] is even with question with web sites such as exposeadam.com. TheStreet has lost a supporter here and many more will follow because of the tatics [sic] Adam F [sic] does. At least people are starting to learn the truth not to trust what you say.

The irony of his alias escapes him.

If you type "Adam Feuerstein" into Google, the fifth search result links to Expose Adam Feuerstein -- a website "devoted to providing a forum to rebut and correct the numerous one sided articles written by Adam Feuerstein on behalf of the Street.com."

I don't know the identity of the investor who created ExposeAdam.com but I'm flattered he/she thought me so important and influential that a website devoted to knocking me down needed to be built. You can find mentions of the web site with links plastered on blogs and stock message boards across the Internet, which explains its prominence in a Google search of my name. In the past week, a Galena Biopharma (GALE) retail investor has taken to Twitter and the comments section of my columns to make sure everyone knows about and reads ExposeAdam.com

But here's the problem. ExposeAdam.com was built on the belief that I was a hedge fund puppet paid under the table to bash and destroy Spectrum Pharmaceuticals (SPPI). This was back in the summer of 2011 when Spectrum bulls and bears were engaged in a fairly boisterous debate over the company's cancer drug Fusilev. I wrote columns supporting the bear thesis, which believed a surge in Fusilev sales -- and Spectrum's stock price -- was destined to be short lived.

You know where this is headed. The Spectrum bears -- myself included -- were right. The Fusilev growth story blew up in March 2012. Spectrum shares sank and have never fully recovered. The Spectrum investor behind ExposeAdam.com stopped updating the blog before the stock blew up. I wonder what he'd say about me now?

My truth-telling about the masterfully spun results from Prana Biotech's (PRAN) PBT2 Huntington's disease study and pushback against the "rah rah" tweets of Prana promoter Dr. Rudy Tanzi set some of you on fire. It reminded me of 2008. I'll explain why below, but I'll let the angry Praniacs speak first:

Fred M. emails:

You are a jerkoff. Glad your shorting pals had their asses ripped off today. Anyone that follow your recommendations deserves to get screwed.

Todd S.:

Your article is complete BS and you should be banned from allowing to write for financial publications forever. Every other analyst and publication loves the news and you have to try and destroy Prana with inconclusive BS just to get your name in the paper. I have a person in my family with Alzheimer's and if this drug could even just help her in the slightest way it would be a life changing improvement. What you wrote here doesn't only affect the company but affects everyone that needs a cure or at least a therapeutic fix at this time for a nasty disease. You are just another Wall Street fool thats only in it for himself. You can affect this company from getting the funding to complete its testing. Do you even realize the BS you talk and how it affects millions of people and I am not talking about the stock but the real reason behind the company. I seriously hope you don't get Alzheimer's because if you do Prana should disallow you from using their drugs. 

"Steviee" writes:

adam feuerstein you are a freakin disgrace, how much are the shorters paying you to write this drivel? get some ethics about you.

There are more emails and tweets just like these but you get the idea.

Now for the history lesson for those relatively new to biotech investing. Back in 2008, Elan was a very hot stock because of its experimental Alzheimer's drug bapineuzumab. Elan's partner, Wyeth, was running concurrent phase II and phase III studies of bapineuzumab, which many investors believed would yield positive results and transform the drug into a mega-blockbuster.

I was a bapineuzumab skeptic -- shocking, I know -- and wrote several stories explaining the risks involved with the drug. Much of Wall Street was solidly behind Elan in 2008 and the stock had a huge retail investor following. Needless to say, stories outlining the Elan bear thesis weren't well received by the Elan-loving crowd.

The next four emails were sent to me by Elan investors in 2008. Read them. Notice how they're almost identical to the emails I'm receiving this week from Prana lovers.

Elan email 1:

You DO realize that you are looking like an idiot on this subject, don't you? I hope some hedge fund is lining your pockets well because your credibility is sure to be shot & you will need to find a new career soon! 

Elan email 2:

You are, Sir, quite unbelievable in trying to tint/spin the published top-line results into "something not so positive", whereas scientists who's comments I am reading seem to agree that those results are better than expected - shall we wait and see how the professionals, namely GoldSachs and Leerink Swann are going to comment? But then you were once quoted as saying you liked creating mischief.   

Elan email 3:

This, your latest attempt at derailing Elan, is just incredibly sad. Do you really think people will listen to your rehashed nonsense, when those with true insight and scientific bona fides (Barron's, Chris Jenner of T. Rowe Price, William Tanner of Leerink Swann, Faber of CNBC) illuminate the truth? Elan is in the process of unleashing the most important drug in the history of biotech.  Within that context, your puny denunciations sound breathtakingly childish, petty, and churlish. You've sold your (already faltering) credibility pretty cheaply. And to what  end?  You've achieved what may be a personal,  all-time low. Pitiful.

Elan email 4:

You are wrong on Elan. You were wrong Celgene, a great biotech story. You have stated that Elan investor should be a in for a bad ride? Im in for a ride that will seperate me from being rich into be into SUPERRICH. Elan has been a solid investment case. Look at Credit Suisse analyst report, I would take their word over yours any day. You are a just a biotech writer with an undergraduate degree in Politics. You are not an expert and have no clue to what the involvement of these trials have been. The FDA and the EMEA have signed off on the Phase III for a reason. Immunotherapy works, AN-1792 worked, its just a question of what is the dose and what is the time of the dose. You obviously are lost when it comes to Elan. You will be proven WRONG, and be left to watch  the most successful Alzheimer's approach and potentially the biggest drug in PHARMA history.

Soon after these emails arrived, bapineuzumab blew up. The statistically significant benefits to Alzheimer's patients heralded by Elan and Wyeth in the phase II study turned out to be a mirage concocted from confirmation bias, wishful thinking and stock promotion.

The sad Elan story repeats itself this week with Prana. I doubt many of the mom-and-pop investors buying into the Prana PBT2 spin job remember the 2008 version of Elan, so consider yourself educated and warned. Institutional investors have longer memories, which is why you don't see them rushing to embrace Prana like many of them did with Elan back in the day.

Learn from the past. Don't make the same mistakes.

Finally, let's end this special mailbag with an assortment of reader responses to my Galena Biopharma expose and the follow up.

[Bleep] Hole writes:

You are a total idiot... Your an ASS!!!! Can't stand you !!

"Adam Brother":

You are one Totally worthless ASS HOLE !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


He needs a new keyboard, the exclamation key seems to be stuck.

Linn I. cc'd me on her email to the U.S. Department of Justice:

To The DOJ   I am an investor/shareholder in Galena Biopharma (GALE). One of their products NeuVax is currently involved in a Phase III Clinical trial to determine its efficacy as a vaccine against breast cancer. I don't want to ramble on and on here as this information along with other data related to the company's products and goals can easily found on their website. I am writing to you because after investing in GALE close to two years ago, I noticed with some regularity the continuous slandering and libeling of the company by one Adam Feuerstein. After researching Adam's comments posted on financial message boards and articles written by him in financial publications, I found most of them to be salacious and without merit using pseudo-science to make his many claims against Gale's line of products and the company itself.

I believe the sole purpose for this behavior was and is to this day to bring GALE's share price down.   I am writing to you on behalf of myself, the company and especially the many women suffering from breast cancer to see if there is any legal recourse / remedy in getting him to STOP spreading his lies and untruths about GALE. His actions not only affect the many shareholders who have invested their hard earned dollars in this company but also more importantly the many women's lives that could be altered as a result of his dubious actions.   Any insight or assistance regarding this issue would be greatly appreciated.

"Aku1" screams:

HOPE YOUR FAMILY ALL GET CANCERS WITH NO CURES

ATW1105 writes:

Some things never change and once a douche bag always a douche bag .

"fpimental":

you are the worst biotech asshole ive ever seen you and your monkey friend cramer biggest doushbags on face of the earth look four eyes I will make it easy for you I will report you to the sec for securities fraud asshole mother fucker

David L.:

I hope the SEC comes knocking at your door here soon for all the lies you post regarding GALE.  Manipulation for gain is a crime and I hope your cell mate explains that to you with endless love.  Take care!

Toby E:

Your article on GALE is terrible. I am all for researched respected opinions and like to hear both the bear and bull case. You crossed a line with this. I'm disappointed in the Street who I had more respect for. Your actions are inexcusable and you should be fired. Allegations without merit are irresponsible. You have no proof. Your piece is akin to a Michael Moore piece using bits and pieces of information to draw an unfounded. You, Cramer, and Link should all be ashamed. Shame upon you!

"fpimentel" (again):

stop this lies about gale just because you want the stock cheaper doushbag I really hope you die of cancer scambag

Matt S.:

YO DUDE !! How did you end up as a paid shill for a bunch of immoral money grubbers. Oh, I know, you need to eat. But you could just as well have turned your Political Science degree into something worthwhile - like a door to door hairbrush salesman.  Hmmm, maybe not - you'd scare all the people who's doors you knock on with that ugly mug of yours. 

Just amazing what desperate people do to make a living. I doubt if you are proud of yourself, and likely you do have some amount of conscious thought that what you are doing is wrong.  But, Man DUDE, writing crap for people that pay you to write crap so they can make money from the fear and mis-information you piss out;  that's a sure fire way to mark you as the most un-capable person in the world ! ! ! !  

Does your Mom know what you do for a living ?   Honestly, does she ?   I'll bet you spin lies and tales to her about your grandiose vision of a "man that moves the markets".    But, you know, and I know you are not of any value, except to those who pay for your words.    And that, my little shill, is why you will be forever held in shame and contempt by those of us that do real work, with real contributions to the good of society.

Thankfully, though, you will fade away; and in your lonely misery, we will have soon enough forgotten you.  (Perhaps though, you can be so kind as to usher yourself to the doors of hell sooner than later).  

Okay, enough time wasted on you - and, Ohh, don't forget to check with your owners on the next target they need you to bash and trash.   You are so in demand (like a good whore in San Diego).    Love you DUDE !! Matt

Thanks, dude. Much appreciated.

The regular Biotech Stock Mailbag will appear tomorrow. 

-- Reported by Adam Feuerstein.

Follow Adam Feuerstein on Twitter.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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