by Steven Ertelt
September 10, 2006
Alameda, CA (LifeNews.com) — The biotech firm that misled the world about a supposedly ethical method of obtaining embryonic stem cells has made millions from its announcement. California-based Advanced Cell Technology announced Friday it has closed two financial deals generating approximately $13 million in cash.
The firm recently claimed to have created a new method of obtaining embryonic stem cells without destroying human life. In said in a press release that none of the sixteen human embryos used in the experiments were destroyed even though all were.
The company continued the deception in the announcement of the new details by saying that they will allow ACT to pay for more research on the supposedly ethical technique.
"We expect the proceeds generated by these financings will fund preclinical studies and accelerate our progress to commencement of the clinical studies necessary to develop real treatments that tap the amazing promise of stem cell technology," William Caldwell IV, the firm’s chief executive officer, said in a statement LifeNews.com obtained.
The company originally hoped for $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 and the company exercise some of its outstanding warrants and raise another $5 million that way.
Leading bioethics watchdog Wesley J. Smith, who helped expose the misleading press release that claimed no human embryos were destroyed, said the company did a great job of misleading investors and gaining a huge financial windfall from the media splash.
"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 and closed on Friday at 83 cents a share.
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.