The Buzz as $ZFGN #Zafgen Inc. Continues to Fall, Attorneys Begin Circling as #Vultures

The Buzz as $ZFGN #Zafgen Inc. Continues to Fall, Attorneys Begin Circling as #Vultures
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Partners at two major law firms compare notes as they look to take on ZFGN cases. They are also looking for the body of the Phase 3 victim so they can eat away any exculpatory evidence that might cover Zafgen.

This is one we have covered all week. Zafgen Inc. (NASDAQ: ZFGN) announced this week a death in their “Phase 3 bestPWS study of beloranib in Prader-Willi Syndrome, a rare genetic disorder with a high rate of mortality linked to obesity and its co-morbidities.” (Quote from Tuesday’s press release.)

Let me say this up-front:

It is a courageous thing to get involved in a trial of a drug as a patient. Whether you are getting the drug itself or the placebo, you are contributing towards a better life for all humanity. The person that died, regardless of the reason, was a very good person for even being involved. 

Drug companies in the United States are abused by lawsuits. Sure, someone should pay when someone dies due to reckless conduct, if that is the case. Drug companies have to conduct trials. The participants usually know all of the risks up-front. I don’t know if that is the case here. We don’t even officially know the cause of death with this patient’s death. 

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Public companies are often stunned when terrible things happen. They don’t see it coming and suddenly they have a PR nightmare that could either heavily damage the company – or even put the company out of business completely. In this case, on top of the death of the patient, now we see law groups stepping up to the plate to “investigate” on behalf of shareholders. Is that a good thing? I don’t really like it. Today we have SEVERAL law groups reaching out to investors to discuss their potential damage claims against ZFGN. I argue the very act of putting out such a press release is not only suspect as a possible attempt to capitalize off of the death of a patient in this trial, but putting out such press releases so close to the announcement of the death further damages shareholder’s equity – especially when we don’t have an officially announced cause of death yet. 

The chart obviously shows the losses on the stock STARTED after the open on Monday of this week. Someone at the Company will have to answer for how the word got out to investors. Anyone shorting or capitalizing on options on ZFGN will likely be investigated by the SEC at some point. Some reports say the Company was canceling meetings and showing outward signs of freaking out on Monday. We know that somewhere somebody got the news and got it out. 

When you wonder why their isn’t a drug for some possibly curable or treatable disease, go and look at today’s press releases from these various law firms. Think of how brave a company must be to even attempt to do what ZFGN is doing. 

Now, let’s get everyone’s FRIDAY take in the Buzz: 

Calderquacks is buying on the dip:

Pharmalot sees the legal firms coming after this:

Bursatil sees this one still bleeding:

Schulz likes the chart? Not sure what he sees, unless he is talking about the buying opportunity:

Void Bot sees a pop:

Fara will come in at $10:

Trevor thinks the only buying is covering shorts:

Pan is in at $12.08 – but it’s hard to pick a buying price with a stock like this!

Drew Powers is covering at $12.03, locking in a gain on a short:

Gerber is not happy here for several reasons:

This is where Drew pushed his short idea earlier:

A Tall Texan asks the big question: Is there more upside than downside left in this one?

We’ll bring you more as we see it on ZFGN!