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on My Watchlist
The Company develops therapeutic drugs designed to treat the underlying causes of degeneration of the brain and the eye as the aging process progresses, initially focusing on Alzheimer's disease.
Today's events provide further evidence that the management of Prana is desperate and unprincipled. The stock was up as high as 2.25 near the open after the company issued a PR titled "Prana’s PBT2 Directly Restores Neurons Critical to Cognition". The PR refers to an article in the Journal of Neurochemistry, a second or third tier neuroscience publication, that has been available online since August 25 without creating a ripple in the share price. Apparently the people bidding up the share price on the PR this morning aren't the type to actually read journal articles. If they were, they would have realized that the substance of the article bears no resemblance to the title of the company PR. The article involves benchtop experiments performed in vitro on a neuroblastoma cell line, not neurons. The findings were that PBT2 mediates activation and inhibition of various intracellular enzymes by induction of phosphorylation. The concept of "directly restoring neurons" is purely speculative and confined to the discussion section of the paper, and the title of the PR is a complete misrepresentation. In fact, the experiments were not designed to measure the functionality of neurons or synapses in any way.This may seem like splitting hairs to some, but to me it represents a continuing pattern of misrepresentation of data and events by Prana dating back at least to their reports of the results of the phase IIa study of PBT2 in Alzheimer's patients. In a PR entitled "Prana Announces Success in Phase IIa Clinical Trial of PBT2 in Early Alzheimer’s Disease" they selectively promoted benefits seen in two out of four adjunct test of cognitive function while downplaying the complete absence of improvement in ADAS-cog, the generally accepted primary measure of clinical effect in Alzheimer's. Since that study in early 2008 they have repeatedly referred to it as an unqualified success without progressing to another clinical trial. They now project initiating simultaneous phase II trials of PBT2 in Huntington's and Alzheimer's towards the end of 2011, but only have 9M in the bank as of the last quarterly statement. A proposed 5M ATM dilution and a 1M PIPE from Quintiles are unlikely to provide sufficient funds to complete these trials.Prana is clearly hoping to induce a sustained lift in their share price to facilitate a large dilutive financing that will provide them with 15-20M to complete their proposed trials. Hence odious PR such as "Prana's Planned Huntington's Trial Receives Strong Interest From Patients and Researchers". No, nothing concrete in the body of that PR related to establishment of clinical sites or patient enrollment. Just the general sense of management that they are very appreciated by the Huntington's community. Thanks for the update.I don't think Prana will be successful in diluting at a higher share price. They've tried these tricks too many times already. Hence the desperation. The only thing that remains to be seen is whether they will simply continue to postpone the expensive clinical trials indefinitely, or if they'll bite the bullet and dilute at 1.5.
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