Today’s story begins with an aging office park, 500 arthritic Phase III subjects and a freezer that eats dreams. Welcome, dear readers, to the world of Ampio Pharmaceuticals (AMPE), the filthy reverse merger put together by Las-Vegas-based stock promoter Jens Dalsgaard, charming the market this week with tales from Freezergate ’14 (read more about Freezergate here).
Sell-side shill Raghuram Selvaraju, of Aegis Capital, brushed off Freezergate as an innocent distribution error in his report of 21 August 2014 (emphasis mine):
This morning, Ampio Pharmaceuticals announced a delay in the data analysis of the STEP study due to the fact that the study drug (both AmpionTM and the placebo) were exposed to lower temperatures than permitted by the drug specifications during shipment to the clinical sites….During the review of all documentation following the unblinding of the study, the company’s independent Clinical Research Organization discovered that the drug product received at the clinical sites had been below the temperature requirement of 15 degrees Celsius and may have been frozen for some period of time.
Innocent enough? Hardly. All Ram is doing is regurgitating the company line, spinning what most certainly be failure into platitudes and excuses designed to keep suckers buying paper that likely is only worth the cash on the balance sheet, roughly $1.25 per share. But what really jumped out at us was a creative use of the plural (clinical sites?) and a funny definition of the word “independent”. We were recently in sunny SoCal and investigted this independent CRO, which just happened to share a wall with the study’s sole site and Principal Investigator (“PI”). Coincidence?
If Ram had bothered to perform even the most basic of due dilligence, he would have been tracking the progress of the Ampion trial on the clinicaltrials.gov website. There he could have seen that there was only ONE clinical trial site, the office of Dr. Quang D. Vo in Anaheim, CA 92801. Isn’t that a red flag right there? Only one site and one doctor for a 500 patient Phase III trial should raise many alarms. What reputable journal would publish such drivel? This is not a small pilot study of 5 patients, where a single site is appropriate. This is a large randomized pivotal trial.
Further, Ram could have also discovered the identity of the “independent Clinical Research Organization” that AMPE had hired. That CRO is named, in a delightfully ironic coincidence, Dream Team Clinical Research (remember stock promotion firm Dream Team Group?).
From the comfort of one’s own desk, or laptop, one could visit the website for Dream Team Clinical Research. This would take about ten seconds, and would raise an ENORMOUS red flag. Probably enough of a red flag to warrant a search on what other this wonderful outfit has been involved with, let alone managed. Go ahead, head over to clinicaltrials.gov, do a search on Dream Team Clinical and come on back.
Being horrified at the lack of actual clinical trial management experience, the next step would be to make an in-person trip to the CRO offices and the clinical trial site. After all, that’s just what we did here at BuyersStrike!, a little detour to a Vietnamese neighborhood of strip malls and inexpensive apartments just off the highway in Anaheim, CA.
Here is what we found when we visited the offices of Dream Team Clinical Research at 760 N. Euclid Street in Anaheim, CA:
This is a small office building on the east side of Euclid Street, with outdoor stairwells, next to McDonald’s to the south and an apartment building of similar construction to the north. Let’s see the tenant list:
OK, off to Suite 105 then.
Can you make out the text on the bottom half of the door?
As we were there on a weekend, the door was locked. So we walked next door to Suite 104. Any guesses what we found?
Look at that. It’s the offices of Dr. Quang D. Vo, principal investigator of the AMPE study, and the only listed trial site. Right next door to the clearly world-class CRO hand picked by talented, reputable, AMPE management. Just how independent is this CRO? Clearly not independent of the only trial doc and trial site. What possible problems could there have been moving the drug from Suite 105 to Suite 104?
And yet company management, and their sell-side shills like Raghuram Selvaraju want you to believe there were multiple sites, an independent CRO, etc. Do you still believe? Or is it more likely a pathetic ruse?
Sell-side firms like Aegis would clearly rather shill for scummy reverse merger banking clients like Ampio than spend 10 minutes online to do basic research. Ram’s i-banking masters would rather pay for glitzy conferences to sucker dumb institutional money than pay for a ticket to LA and a rental car to visit the trial mill where the sausage is being made. Sad.
Sadder still, that legitimate publications and news services like Bloomberg, and cable stations like CNBC, often quote sleazy operators like this as “experts”, as if they have opinions with any worth at all whatsoever.
Speaking of institutional money, how is it that firms like Knoll Capital (the largest institutional investor in AMPE owning ~5.7% of the company), are even in business managing other people’s money given their clear incompetence? How could so-called professionals fail to perform such basic research. Certainly Fred or his daughter Karina Knoll know how to use a search engine, how to book a plane ticket and how to drive to Anaheim from LAX. If not, there is always GPS.