by Steven Ertelt
August 27, 2006
Alameda, CA (LifeNews.com) — Just two days after it claimed to have come up with a new technique for obtaining embryonic stem cells that doesn’t involve the destruction of human life, California-based Advanced Cell Technology says investors have given it commitments to raise millions of dollars in new funds.
The company had plans to try to raise $11.3 million in private placements but it said that most holders of debentures and warrants to purchase its stock agreed to exercise their options to buy more.
That will provide ACT with $8.5 million, according to a San Francisco Business Times news report and the company will exercise some of its outstanding warrants and raise another $5 million that way.
ACT has come under fire for lying about the new method and making a bundle on the stock market as a result.
Though the biotech firm said it obtained embryonic stem cells without killing any human embryos, it appears all of the 16 human embryos Advanced Cell Technology used to come up with the process died during the procedure.
"I have checked this out. The actual paper published in Nature states that all 16 embryos were destroyed and 4-7 cells taken from each 8-10 cell embryo," leading bioethics watchdog Wesley J. Smith explained.
Smith said ACT successfully duped the media into thinking it had achieved success.
"The press release from ACT told a different story and the media stampeded. In other words, they wrote off the press release, not the actual published science," Smith said, calling it "shameful."
The ACT media blitz apparently had the desired effect.
Shares of Advanced Cell doubled within a matter of minutes on the announcement, going on to close the regular trading session up $1.43 to $1.83, an upswing of nearly 358%.
But as news of the false claims spread, the stock declined on trading Friday and eventually went down 40 percent in value to close at 96 cents.
Shares of ACT stock had been on a steady decline from a high of $2.96 in July 2005 until a low of 40 cents on the day ACT made its announcement.