Sorrento Therapeutics CEO: We are not a ‘pump and dump’ scheme

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Sorrento Therapeutics founder and CEO Dr. Henry Ji is defending his company after several days of volatility in its stock price following details on a potential COVID-19 antibody treatment.

“There is a lot of investors suspecting this is another pump and dump, which is typical, which is normal, but we don’t believe that’s the case,” Ji said on Yahoo Finance’s The First Trade.

On May 15, Sorrento (SRNE) said that its anti-SARS-Cov-2 antibody demonstrated 100% inhibition of COVID-19 in an in vitro infection experiment at a very low antibody concentration. Sorrento said it will continue testing the product in the hopes of getting it approved to treat COVID-19.

The stock promptly exploded more than 200% over the next day or so of trading as investor optimism grew on the potential of Sorrento’s drug. It’s not uncommon to see small-cap biotech stocks act like this on the slightest bit of promising news regarding a new drug. Seeing as COVID-19 is such a large global issue, any indications of a treatment would likely be handsomely rewarded by the market.

Sorrento shares have fallen about 50% from their highs on the news, perhaps raising questions in the market on what Sorrento actually has discovered drug wise. Also worth noting that like other emerging biotech companies, Sorrento isn’t profitable — which adds to the risk profile of the stock.

Focusing on ‘the real deal’

Ji is unfazed by the stock price volatility. He says his team is focused on getting a COVID-19 treatment to market.

A registered nurse draws blood during a COVID-19 antibody test drive at the Abyssinian Baptist Church, Thursday, May 14, 2020, in the Harlem neighborhood of the Manhattan. Churches in low income communities across New York are offering COVID-19 testing to residents in conjunction with Northwell Health and New York State. (AP Photo/Mary Altaffer)
A registered nurse draws blood during a COVID-19 antibody test drive at the Abyssinian Baptist Church, Thursday, May 14, 2020, in the Harlem neighborhood of the Manhattan. (AP Photo/Mary Altaffer)

“So what we are focusing on instead of watching the stock going up or going down, we are focusing on making sure we have the real deal. So you have the antibody that can prevent the virus from infecting healthy cells. That means you will have a real product. If you have a real product, eventually the stock will be reflecting the assets you have. And we believe right now probably there is a lot of investors excited about the story,” Ji said.

Ji added, “In the short-term, the stock price is a voting machine and eventually a weighing machine, you know, as Warren Buffett said. So I think eventually it will reflect the value we have here.

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