Now this is how a teaser ad should look!

Any editor can promise huge gains — and heck, maybe even occasionally deliver on those dramatic gains if they get lucky or smart for a moment in time … but how many investment newsletters can tease that you’ll “live 20 years longer?”

Here’s how Patrick Cox gets our attention in his efforts to sign up subscribers to his Breakthrough Technology Alert (“on sale” for $800, though I don’t think I’ve ever seen a promo for this one when it wasn’t “discounted” … I’ve never actually seen it advertised at the “list price” of $2,000).

“TOBACCO RESURRECTED!

“Discovered by accident… a chemical compound in tobacco that doctors are now recommending to slow aging!

“BUT because the nattering nabobs of negativity on Wall Street think the biotech firm that owns the patent is a nasty, dirty tobacco company… YOU still have time to load up before the truth is revealed! ….

“Follow the scientific and medically validated recommendations laid out in this email, and there’s more than an excellent chance…

“You will prolong your life by an additional 20 to 30 years…

“You will not suffer from heart disease, cancer or stroke…

“You will not suffer from obesity, rheumatoid arthritis, thyroid disease or even hair loss…

“And the chances of achieving wealth and prosperity you never dreamed of will be increased enormously.”

And he keeps ladling on the plaudits for this one, even saying that he’s taking the product himself:

“I’m going to introduce you to a biotechnology company that has developed what I’m thoroughly convinced is the preeminent life-saving and disruptive technology of our time…

“It could easily add 20 years to your life… and make you 20 times richer.

“And only you, my subscribers and a few other elite investors are aware of this opportunity.

“Full Disclosure: I’ve been taking this company’s product for over one year. How it has restored my health and improved the quality of my life is detailed further below.

“I now recommend their product to many people I know and meet, no matter their age.

“And thousands, if not tens of thousands of people, have already seen the same near-miraculous improvements to their health that I have.

“Sadly, very sadly, as editor of Breakthrough Technology Alert I’m not permitted to own shares in this company, as it would be a clear conflict of interest. But if I could… my goodness, I would grab shares by the truckload.”

Is it starting to sound a little bit familiar? Those who have been aboard the good ship Gumshoe for any length of time have probably seem Cox tease this pick in the past — it’s been one of his favorites for years now. But don’t worry, if you’re new to these parts I won’t spoil the surprise just yet, let’s have a quick look at the clues he provides:

“Because this product is not classified as a drug, the FDA does not require the company to conduct human clinical trials. Yet they’re doing it anyway.

“That they’re willing to commit to a broad range of human clinical trials, including the gold standard of human clinical trials, the double-blind, speaks volumes about the company, and the effectiveness of their product….

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“Your maximum life span is determined by the number of telomeres on your chromosomes.

“If you think of a chromosome as a shoelace, the telomere then is the plastic tip at the end that keeps it from fraying and unraveling.

“We are born with a finite number of telomeres.

“But as we suffer age related inflammation, we lose telomeres at an increasing rate. And when you have no more telomeres left… you die.

“Theoretically then, based on the number of telomeres you possess, you have a maximum life span of about 120 years.

“So by reducing inflammation… your telomere loss is slowed… and your life can be extended…

“Much more extensive double-blind human clinical tests are currently under way. Yet, we already have documented proof that this nutraceutical has outperformed other anti-inflammatories ranging from Lipitor and aspirin to ibuprofen and Celebrex.”

Cox then goes on to recount the long story of how he was introduced to and fell in love with this company — it apparently started when he was out to dinner with John Mauldin, who’s an economic writer you’ve probably heard of, he recently started up his own income-focused newsletter, and Mauldin surprised Cox by introducing him to a man he calls “Mr. Remarkable”, a guy who, to make a long story short, turned his family’s long history with tobacco into a surprise discovery of a compound that fights inflammation and might make us all live longer.

“Mr. Remarkable” is not named, of course, since that would give away the surprise — but yes, assuming you don’t want to sit through the whole long presentation/ad (which is here if you’re curious), Patrick Cox is indeed still teasing Star Scientific. And Star Scientific did just change its ticker, it was CIGX to reflect their history as developer of a patented tobacco curing technique and their first supplement, the CigRX stop-smoking aid, but the new ticker is STSI.

And as you can probably figure out now, “Mr. Remarkable” must be Star Scientific’s CEO and inventor of the special curing process, Jonnie Williams.

Star Scientific has been a wild stock over the past year or two as Patrick Cox has teased and touted it (he also called it the “last stock you’ll ever need” a bit over a year ago) and as other prominent pundits have called attention to the company — including James Altucher, who brought a lot of attention to the stock back in early 2011.

There has also been “real” news from STSI over that time period, including some legal updates on their lawsuits with Big Tobacco (not particularly positive news — they got their patent validated but also have so far been denied on the infringement suit against Reynolds, though that fight is ongoing still and has been for over a decade) and several reports and announcements about the effectiveness and availability of their dietary supplements, first CigRX for smoking cessation, and more recently the potentially earthshaking nutraceutical that Cox touts, anatabine citrate which they market in the form of Anatabloc. I’ve tried Anatabloc too, for whatever that’s worth, though I didn’t have a chronic inflammation problem in particular and probably didn’t try it for long enough to feel noticeable results. Certainly it didn’t seem to hurt anything, though for fifty cents per tiny pill (you take 3-6 per day, I think) you’re probably looking for something better than “didn’t hurt.”

As I’ve disclosed before, I do still hold some long-dated call options on Star Scientific — I don’t know if the clinical trials that are being done on Alzheimer’s patients by the Roskamp Institute will be positive or definitive, but if they are positive there’s certainly a chance for the stock to spike dramatically. What we basically have is a company that has run up on potential and that has effectively no revenue but is aiming at a truly massive multi-billion-dollar market, so the company is probably going to end up being worth either $20 million or a few billion in 3-5 years … it’s just that I have absolutely no idea which, which is why my small speculation is just in the options, to let me control how much money I’m willing to lose. It’s valued at around $600 million today, so potential downside and upside are both quite large.

Incrementally, news on the Anatabloc front has seemingly been pretty good — they’re introducing a skin cream this quarter, since anatabine is supposed to also help with wrinkles and blemishes (anatabine itself is an alkaloid that’s found in many plants, by the way, including tobacco relatives like tomatoes and peppers, but tobacco apparently offers up the highest concentrations for easy extraction), and the next several months offer up some potential for more catalysts. They should have at least preliminary results from some of the Roskamp studies in the effect of Anatabloc this quarter, and there was also a paper released a couple weeks ago about the potential for anatabine to treat thyroid disease. The news is still largely anecdotal — if you check out any of the investment message boards or places like Seeking Alpha the debate will be raging between skeptics who want to see big peer-reviewed results on large populations and early adopters who believe anatabine cured their arthritis or slowed Grandma’s Alzheimer’s. Patrick Cox is certainly a believer, as are several other prominent newsletter guys and pundits, but there is also clearly another side for skeptical investors — about 15% of the shares are sold short (meaning that folks are betting the stock will fall). Big short positions can also cause a “short squeeze” if the stock spikes up and those shorts have to cover their bets by buying stock, so that could serve to amplify any moves if the stock were to jump higher on “real” good news (ie, not just on the attentions of John Mauldin or Patrick Cox).

Their core product, Anatabloc, has been available now as a retail product for close to a year, I think, and it remains a very light seller in these early days (though the numbers are pretty stale on revenue now, they should release the last quarter’s numbers any day now) — so you really do need to have some “difference making” news in order to justify the stock’s valuation. They had sales of a bit over $1 million over the past year, and the stock is valued at around $600 million, so this is clearly a bet not on the current level of interest in Anatabloc (including the endorsement by Fred Couples, one of their “Brand Spokesmen”, and their increasing availability in retail channels like GNC), but on their ability to ramp up that interest dramatically following positive clinical results.

This is a nutraceutical and dietary supplement, so they don’t need clinical trials for FDA approval, but they do need growing acceptance in the medical community and those clinical results that get publicized and turn into gossip on the golf course or at the senior center and that make doctors say, “hey, you should try this for your chronic inflammation.” STSI shareholders need that to build pretty consistently, but the reason for the optimism is that IF this interest can build and they can effectively market it to pretty much everyone over 40 as a core “vitamin” kind of supplement, the market is stupendously, ridiculously, absurdly large — almost everyone has either some sort of inflammation complaint as they age, or some fear of Alzheimer’s, so there could easily be millions of customers willing to pony up the $100 for a two month supply and keep taking it for years if the efficacy is backed by medical studies.

Which is why I’ve been willing to speculate on the options a bit. And also why I won’t miss a mortgage payment if the news turns out to be more fizzle-y or, God forbid, genuinely negative. It is, at the very least, a fun stock to watch — and I know many of you have traded this one in the past, or tried their products, so feel free to jump in with your comments below. I’ll be keeping an eye out for the preliminary Roskamp results, which might be interesting, and you can bet that if more positive news comes out we’ll see this trumpeted more and more by Patrick Cox… just remember that if the results of the study are “meh,” the stock has a long way to fall.