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The Aftermath: IMCL Declines from 74 to 6 in Only 5 Months!
IMCLONE Time Line: 2002-2003
Jan. 25, 2002 - U.S. Securities and Exchange Commission and the U.S. Justice Department launch probe into ImClone and Waksal.
Feb. 14, 2002 - Waksal notifies the Securities and
Exchange Commission for the first time of 50 trades he made in ImClone stock going back as
far as 1992, transactions that should have been reported within months of their
May 22, 2002 - Samuel Waksal resigns as CEO of ImClone. Samuel's brother Harlan Waksal takes over as CEO.
June 12, 2002 - Samuel Waksal is arrested on charges he illegally acted on inside information in attempting to sell ImClone shares, and tipped family members to do the same.
Aug. 7, 2002 - Samuel Waksal, already charged with insider trading, is indicted for obstruction of justice and bank fraud in a case that has rocked investors' confidence. Waksal is accused of pledging ImClone securities he no longer owned to secure a $44 million loan and forging the signature of ImClone's general counsel to fool the bank into believing he still owned the securities.
Aug 14, 2002 - ImClone sued Samuel Waksal, claiming Waksal ordered the destruction of documents that may be important in a government investigation into the company.
Oct. 15, 2002 - Waksal entered a partial guilty plea to insider trading and obstruction of justice charges.
March 3, 2003 - Already awaiting sentencing for insider trading, Waksal pleads guilty to charges of evading tax on $15 million of art. He allegedly sent the art to an ImClone manufacturing facility in New Jersey to avoid New York sales taxes and then had the paintings re-directed to his Soho apartment.
March 11,2003 - Waksal agreed to partially settle a U.S. SEC suit by agreeing to be barred from acting as an officer of any publicly traded company and paying back more than $800,000 in insider trading profits.
March 31, 2003 - ImClone discloses that Waksal failed to pay income tax on the exercise of certain stock options and that it will take a charge of $23.3 million to account for the omission.
April 9, 2003 - The company says securities regulators are investigating ImClone's failure to pay taxes on stock options exercised by Waksal and other officers and directors.
June 4, 2003 - Martha Stewart charged with obstruction of justice in connection with an investigation into the timing of her sale of ImClone stock.
June 10, 2003 - Samuel Waksal, the former head of Imclone Systems was sentenced to 87 months in prison and is ordered to pay $3 million in fines for tax evasion and insider trading.
ImClone - 2006-2007
We would trade this stock very circumspectly. Depending on which side of its
50 day moving average, one could be bullish or bearish. Even better is to use a 50-day
moving average Tiger's unique "Closing Power Indicator." Its gain for the past
year is 134%. Call us and we will be glad to discuss this indicator, orginated by and
only offer by Tiger Software.
Eventually Erbitux did win FDA approval. One of the FDA officials working on the application
said it was a case of "good drug but bad application". The stock has been laboring under the bad
press for years. Investors can't forget how this company wiped out their life savings. Nor should they!
It is best to stay completely clear of a stock like this once news about its credibility comes out. Simply
selling out when the stock drops below the 50-day moving average when the Accumulation Index is
negative is nearly always a good idea. Selling short stocks that gap down like this on very bad news is
certainly the only way to profit from them until all the news comes out. Thinking that the stock looks
cheap because it is down 50% does not work. This stock lost 90% of its value in 6 months.
Interestingly, the stock turned up from a bottom near $6 the very day Sam Waksal was
found guilty of insider trading.
Being an insider is the only safe way to own a stock like this. Putting Tiger's Accumulation Index
on your side, is the next best thing to having a seat on the Board of Directors next to Carl Icahn.
And even that is problematic.
Don't Trust A Board of Directors To Right Itself Voluntarily
Sept. 21, 2006 - Carl Icahn Asks Imclone Chairman, David Kies, To Step Down and
Ddisclosed a 13.85% Stake in the company (11.67 million shares). His letter shows how badly the
company was being run in his view:
"During your tenure,
ImClone has suffered as a result of its inability to attain the leadership position it
During your tenure, I believe that
commercialization has suffered, trials have not been sufficiently pursued, the head
During your tenure, ImClone hired a President and
CEO who was totally the wrong person for the position and it
During your tenure, ImClone's meaningful lead
relative to potential competitors has shrunk considerably and ImClone
Very truly yours,
The Board also determined today that it would waive all director
fees for 6 months and all option grants for the next year.
Additionally Mr. Icahn stated: "ERBITUX is an important drug, and action must be
taken quickly to make up for the