Well, no matter how much I try to discount the writings of Tim Fields and the folks at Untapped Wealth (that’s a long story, but it starts with the fact that they “rented” their name and reputation, such as it was, for a stock-pumping ad campaign for Aussie Soles, a firm that has since fallen from a couple dollars to one cent), they keep coming back with more florid ad campaigns — and readers are still intrigued, so the Gumshoe will keep writing about them. I live to serve, after all.
This one appears to be a genuine ad for the Untapped Wealth newsletter, not a sneaky pumping scheme for a stock … and although the Untapped Wealth track record might not be spectacular, at least in the stocks of theirs that we’ve looked at, that doesn’t mean they can’t come up with a good idea every now and again.
So … is this one of those good ideas?
Fields is telling us that the next big wave will be personalized medicine, and using genetic testing to customize treatments. We’ve heard that before from several newsletter editors, and it has been an investment theme for years.
Here’s how they prime the pump on your salivary glands:
“At $4, this is a dream stock at a bargain price that could be the most profitable investment of your entire lifetime. Even the federal government says the Genetic Diagnostics industry ‘PROMISES TO REVOLUTIONIZE MEDICINE.’
“ACTION TO TAKE RIGHT NOW: Buy shares of our #1 Diagnostics Stock in the $4 range and watch your $5,000 investment rise to $16,250 or more.”
Nice, eh? I regret to inform you that these shares have since gone up a bit, perhaps in part due to the attention from Fields, but I think we can settle for a 200% gain instead of a 220% gain. We’re generous that way. Then again, odds seem fairly solid that the attention will wane, and the stock will probably again see the $4 range.
But we’re getting ahead of ourselves — you’d probably like to know the name of this stock, no? No? Come on, your friendly neighborhood Gumshoe is going to all this effort, the least you can do is keep reading. Just a few more paragraphs, I promise.
Here’s how Tim describes the company’s business:
“With the gene-based Multiplex test (the detection of multiple targets simultaneously from a single sample)our phantom diagnostics stock has developed, this figure could be cut down to almost nothing. The idea behind this miracle is simple: by knowing what your genetic makeup is, your doctor will be better able to match you up with the most effective drug before you take it. No guessing, no taking chances, practically ZERO side effects.
“This is a m ajor breakthrough. Science has proven that your genetic makeup affects your response to drugs. The British Medical Journal confirms this by reporting, ‘85% of a patient’s response to drugs is due to genetics…’ By ‘reading’ your genes, the treatments you get can works much, much better.”
And there’s some more — a few clues about the size of the company’s patent portfolio, and some more exciting projections about the massive size of the potential market:
“Their patent portfolio is comprised, on a worldwide basis, of 80 issued patents and 150 pending patent applications, which, they either own directly or are the exclusive licensee. The potential with these tests? Huge. The market is surging.
“The Cancer Diagnostic Market Is Expected To Hit $7.4 Billion In 2009”
And a big part of the sales job that Untapped Wealth is doing on this company is due to the past success of their management — probably because the company isn’t actually making any money at the moment and won’t be doing so anytime soon (they’re a development stage biotech firm, so it’s not like that is a surprise).
Because the CEO previously ran a testing company that was bought out by a large firm, Fields tells us that this is likely the strategy for this new company, too — a buyout from a bigger firm that can leverage some successful tests to improve their drugs or just sell them better using their larger sales force.
So who is the management? That’s where we get a few specific clues about the CEO:
“In his previous venture, he served as president and CEO for a developer, manufacturer and marketer of diagnostic products that pioneered the point-of-care blood analysis market.
“This pioneer led them from its early stage to commercialization and then from the company’s IPO in 1992 to its acquisition in 2003 for 5.18 times revenues or $392 million.
But it doesn’t stop there … From 1973 through 1989 he held executive positions with a $7 billion manufacturer and distributor of healthcare products and a $3.5 billion diversified manufacturer and distributor of healthcare products.”
So now … drum roll, please … we’ll feed all that info into the mighty, mighty Thinkolator and find that the stock being teased here is …
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