I addressed this in another thread, but will attach here also....

I addressed this in another thread, but will attach here also. Scuttlebutt is a funny one, basically means it might have an element of truth or could be totally wrong, as is the case here unless we are talking 4 or 5 years down the track. The suspicious thing is the 'scuttlebutt' here is easily verifiable as wrong if you were to search clinicaltrials and investigate the scuttlebutt. We could all start publishing scuttlebutt, eg I was talking to a guy in the pub who is a senior manager at (pick one of Merck, Loreal, Pfizer etc) and he says they are very keen on taking over Clinuvel up to $10 Billion AUD.. where would it lead?

Below is post from earlier...

So now the smoke has cleared on yesterdays shenanigans it seems quite obvious it was a short attack. I guess it had to come at some point and what better time than days out from the AGM? So a broker says HOLD rather than Buy and someone from the fin quotes "market scuttlebutt" about "competition" as if wild rumours are now facts when any self respecting investigator could find that 'competition' is actually 3 to 5 years away at a minimum, but possibly even more. Maybe they could publish some 'scuttlebutt' that Loreal, Roche, CSL, Pfizer and Merck are about to get into a bidding war to take over Clinuvel with bids starting at $200 per share! The facts are:

* There are more than 2 Million open short positions out of just 49.4M shares on issue (4.17% as at 01/11). These positions almost entirely have a average Sell price in the mid to high $20s - so lets give them an average Sell price of $28. At the very modest CUV share price of $40 they have an exposed losing position well over $20 Million and that is before they even get started with their buying back of 2 Million shares in an extremely tightly held stock.

* Considering the above it was unlikely they would sit back and let CUV continue unchallenged on its merry way to $50, $60, $70 and above to something approaching a price I would consider reasonable when compared to every other peer Biotech/Healthcare stock on the ASX, and considering Clinuvel excellent and peer leading financial fundaments (see chart below). The beautiful thing for CUV holders is time is on our side here, a lower price will attract more buying interest and the amazing financial performance of this company has shown already how it can cause large and fast jumps in the share price.

* There are some legit concerns about aspects of Clinuvel management but 'scuttlebutt' is not something we should worry about too much. I have been around the market long enough to see all the games played and unfortunately everyone knows what goes on except for unfortunate 'mums and dads', however, our regulator ASIC is hopelessly flawed in their regulation. Regardless I lodged another complaint on the ASIC website and urge everyone else to spend 5 minutes doing so.

* The number 1 fact is CUV is the worst possible type of share to have an exposed short position in. These shorts were mainly taken out prior to FDA approval but on the day that was granted the case for shorting CUV at these ridiculously low prices died. Shorted companies need glaring weakness and here the company is at no risk of going broke or even requiring capital and they are undervalued. The fact is they are very profitable and getting more profitable at a rate faster than any peer. They have nearly $100 Million in cold, hard cash and they are likely to add a blockbuster indication to their already FDA, TGA, EMA and Israel approved drug at some point in the next few years - shorters would not want to be around when that happens!

* The other point is the extreme lack of liquidity in this share. Yesterday we had a fall in price of 12% based on nothing. There would have been the usual manipulation back and forwards churn, fake liquidity, maybe a few stops and probably even a couple of genuine sellers. On the other side were day traders, churners, buyers including people excited to buy CUV at a good discount etc etc. And all of this added up to JUST 1% OF TOTAL SHARES ON ISSUE. At least 99% of shares were simply held tight - that is interesting and it shows how difficult it will be to buy back 4% of all stock without taking considerable losses as a shorter - they should have done this much earlier. Holders like me seem to be holding for higher prices so bring on new all time highs, $50, $75 etc

* Should mention a 13% implant price rise has only recently started and evidence of this will be seen for the first time in the next quarterly cash report and half year financials. Both should show CUV strong revenue/profit growth around the 50% rate or higher which means next full year report is going to be a beauty!

* As for "competition' what is being referred to is actually a trial molecule. A long way off even entering the rigorous FDA market approval process and a long, long way off trying to compete with the gold standard SCENESSE implant from Clinuvel.

* Finally, having a monopoly in a highly regulated industry with high barriers to entry is really a dream investment scenario.

All IMO DYOR (below is the chart I edited yesterday and posted in other thread)