Shorts Exposed

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Vice President Joe Biden
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I was requested by a caring CTIX investor to have the following call to action shared with our mailing list. I agree that it is appropriate that we, not only as Cellceutix shareholders, but as members of the broad investment community, advocate for change. Capitol Hill needs to be aware of the dangers companies and investors face with blatant market manipulation, such as what Cellceutix has recently faced, and the subsequent negative effects it creates on resources to meet VP Biden’s initiative to develop new drugs to cure cancer.

Take Action Now!
Demand investigation of stock manipulation that is hurting cancer research

I’m certain you are as disgusted as I am about the recent lies and market manipulation to target Cellceutix. Whether you are a Democrat or Republican, we must galvanize every resource available to educate Vice President Joe Biden and others in Washington about the tremendous potential there already exists to fight cancer. It’s imperative that you act now to help put a stop to this illegal market manipulation.

Tell the Vice President money for cancer research is being taken away from right under his nose.

Vice President Joe Biden has spearheaded efforts on many critical issues during his more than four decades in Washington and we need to call upon him. In his recent statement in the White House Rose Garden, Biden made a point to speak of his son, Beau, who passed in May from cancer at the age of 46, and the importance of a “moon shot” to find a cure for cancer. Biden said that he and President Obama have been working to increase funding for cancer research and development “because there are so many breakthroughs just on the horizon” and that he will be spending the rest of his term to push as hard as possible to make it happen as there is bipartisan support to silence the deadly disease.

Biden is looking to increase funding for research, which is fantastic, but as Congress works the budget on that front, they are overlooking that money is being taken away from research by the greed of organizations that use illegal market manipulations to maliciously attack biotechnology companies for their own profit and ruin the confidence of people investing in the stock market.

Tell the Vice President where the money is going.

The letter below explains how these unethical characters strip money from investors for their own profit, while simultaneously damaging the reputation of biotechnology companies and crumbling their market valuations. This causes the slowing of drug development for people in great need.

The VP will surely be interested to know that money is being taken from the government as well. In fact, it costs the government and taxpayers more than one may first think because the reasons can be two-fold. One, every company that receives federal grant money for research that suffers damages resulting from an unsubstantiated attack inevitably costs the government money. Two, if a lawsuit ensues predicated upon the attack, which often happens, it is a drain on the legal system and more costs are incurred by the government. This is money that can be used for cancer research.

Tell the Vice President the Justice Department must look into this.

We are at a point where many major pharmas are cutting R&D expenses to meet market expectations and looking to smaller companies for innovative new cancer drugs. While large firms are not immune to fraudulent attacks, it is the small companies that are the lifeblood of drug development that are often the most easily manipulated and targeted. Such recently was the case with Cellceutix Corp., who has seen its valuation chopped by more than a quarter of a billion dollars following a fraudulent and manipulative article published on the financial website Seeking Alpha by an author with the pseudonym “Mako Research” and a subsequent lawsuit by the Rosen Law Firm. Cellceutix is but one of many companies targeted by this illegal market activity and allowance of this to go unchecked will have a detrimental impact on medical research.

The following is a letter that I urge all shareholders to send to Vice President Biden. Show your support for your company and cancer research by demanding the Justice Department investigate this situation. Please be involved. Have your family and friends involved as well. I urge you to send your message using both the electronic (copy and paste) and first class mail.

Sincerely,
CTIX Shareholder


Relevant links to VP Biden’s mission to fight cancer:

www.cbsnews.com/news/vice-president-joe-biden-60-minutes/

http://www.usatoday.com/media/cinematic/video/74339192/biden-end-divisive-politics-find-cancer-cure/

http://www.usnews.com/news/articles/2015/10/21/transcript-joe-biden-will-not-run-for-president-in-2016

On the following White House website, you are limited to 2500 characters so the following Electronic letter is abbreviated.

Electronic: https://www.whitehouse.gov/contact/submit-questions-and-comments

I applaud you and recent speech in the Rose Garden committing to increase funding for cancer research. I assure you that I stand shoulder-to-shoulder with you in making it personal to find a cure. I write to inform you of a travesty of justice that is taking countless funds away from cancer research and I seek your help for a full investigation on the matter of stock market manipulation that is damaging biotech companies, investors and cancer patients that so desperately need new treatments.

The glaring problem of market manipulation came to me as an investor in Cellceutix, a company developing promising compounds for cancer and other indications. Cellceutix currently has two completely unique compounds in active clinical trials, including a cancer drug for solid tumors and another compound for treating oral mucositis in head and neck cancer patients. Cellceutix was awarded in 2010 approximately $730,000 in total grants under the Qualifying Therapeutic Discovery Project program, money that was used to advance drugs to clinical trials.

Unfortunately, Cellceutix has been the victim of manipulative market activity that is becoming increasingly prevalent in the biotech industry. In a nutshell, “shorters” (traders/funds that profit by a stock price dropping) publish false and disparaging articles on the target company, attempting to scare shareholders into selling their position, thus driving the stock price lower for their gain. Understand that there is nothing illegal about shorting, but “naked” shorting (where there actually aren’t any shares available to short) is, as are market manipulation and publishing knowingly false articles to cause panic.

The people responsible for this type of activity have no concern for the damage they are causing to portfolios or lives; no regard they can be hampering drug development; and no respect for the fact that funding may have come from the government. Lawsuits often ensue, draining resources of the judiciary system. Cellceutix is fighting this (http://cellceutix.com/cellceutix-responds-to-rosen-law-firm/#sthash.D7PK6gCv.dpbs) as an advocate for the industry, investors and patients in need.

Many companies have been damaged by this immoral activity. This illegal practice is detrimental to medical research and it must be stopped.

------------------------------

Letter to be sent by first class US mail. You may wish to add your personal experience:

Your Name:
Address:
City, State:


The Vice President
1600 Pennsylvania Avenue NW,
Washington DC 20500


Dear Mr. Vice President Biden,

I applaud you and recent speech in the Rose Garden in which you committed to work with President Obama to expend all efforts to increase funding for cancer research. With cancer being the culprit in 25% of all American deaths, I assure you that many people stand shoulder-to-shoulder with you in making it personal to find a cure. I write to inform you of a travesty of justice that is taking countless funds away from cancer research and I seek your help for a full investigation on the matter of stock market manipulation that is damaging especially biotech companies, investors, the scientific community and all the cancer patients that so desperately need new treatments.

The glaring problem of market manipulation by those looking to drive down the price of a stock came to me as an investor in Cellceutix Corp., a clinical stage biotechnology company developing promising novel compounds for cancer and other indications. Cellceutix currently has two unique compounds that have never been seen before in medicine now in three active clinical trials, including a study of a cancer drug for solid tumors at Dana-Farber Cancer Institute and a separate multi-center trial for treating oral mucositis in head and neck cancer patients. The company was awarded in 2010 approximately $730,000 in total grants under the Qualifying Therapeutic Discovery Project program when Cellceutix was a pre-clinical fledgling company and this money was used to advance its drugs to clinical trials. To that point, thank you for your research funding efforts.

Unfortunately, Cellceutix has been the victim of fraudulent and manipulative market activity that is becoming more and more prevalent, which is damaging and a growing threat to the biotechnology industry. There is no real secret recipe to the activity; “shorters” (traders/funds that profit by a stock price dropping) publish false and disparaging articles on the target company, attempting to scare shareholders into selling their position, thus driving the stock price lower for their gain. Understand that there is nothing illegal about shorting, but “naked” shorting (where there actually aren’t any shares available to short) is, as are market manipulation and publishing knowingly false articles to cause panic.

The people responsible for this type of activity have no concern for the damage they are causing to peoples’ portfolios or lives. Moreover, they seem to have no regard that they can be hampering drug development or respect for the fact that part of the funding may have come from the U.S. government. In the Cellceutix case, the article published by an anonymous author (pseudonym “Mako Research”) on the investment website Seeking Alpha was one of the most egregious attacks filled with unsubstantiated claims, unlearned scientific statements and misrepresentations I have ever seen. Perhaps even more amazingly, the Rosen Law Firm filed a lawsuit against Cellceutix citing the Mako article as the foundation of the claim, even though Cellceutix publicly debunked the article with facts. I am compelled to make you aware of the drain on the judicial system for what I consider a frivolous lawsuit. Following the defamatory article and lawsuit, the value of Cellceutix has been reduced by more than a quarter of a billion dollars. Further, Cellceutix is by no means the only company in this situation. Cellceutix is aggressively fighting the lawsuit and says it will be pursuing sanctions if the case is not dropped. (The Rosen Law Firm press releases on the numerous companies they have targeted; http://www.businesswire.com/portal/site/home/search/?searchType=all&searchTerm=rosen%20law%20firm&searchPage=1).

I support Cellceutix in championing an effort to advocate for change for the good of its shareholders, the biotechnology industry and the patients whose lives depend on the development of new drugs for cancer and other diseases. Cellceutix has hired the Ashcroft Law Firm, led by former US Attorney General John Ashcroft and Michael J. Sullivan, former United States Attorney for the District of Massachusetts. (http://cellceutix.com/cellceutix-responds-to-rosen-law-firm/#sthash.D7PK6gCv.dpbs). The road of companies damaged by these immoral characters runs long and the impact on drug development is immeasurable. You don’t have to look hard to find companies that have been falsely attacked by bloggers with a short position that has shaken away investors. Many companies have been damaged by this immoral activity. This illegal practice is detrimental to medical research and it must be stopped.

Most respectfully,




The following is the letter I sent on October 28, 2015

Dear Vice President Biden,

I applaud you and recent speech in the Rose Garden in which you committed to work with President Obama to expend all efforts to increase funding for cancer research. As a son who helplessly watched my mother and father suffer through painful chemotherapy before finally succumbing to the terrible disease, I assure you that I stand shoulder-to-shoulder with you in making it personal to find a cure. The dedication is the reason that I started Cellceutix; I am committed to finding new solutions to treat deadly diseases and conditions. I write to inform you of a travesty of justice that is taking countless funds away from cancer research and I seek your help for a full investigation on the matter of stock market manipulation that is damaging especially biotech companies, investors, the scientific community and all the cancer patients that so desperately need new treatments.

To my knowledge, there is no other clinical-stage biopharmaceutical company of our size that has accomplished so much in only eight years since inception. We currently have two unique compounds that have never been seen before in medicine now in three active clinical trials, including a study of a cancer drug for solid tumors at Dana-Farber Cancer Institute and a separate multi-center trial for treating oral mucositis in head and neck cancer patients. We were awarded in 2010 approximately $730,000 in total grants under the Qualifying Therapeutic Discovery Project program when we were a pre-clinical fledgling company and this money was used to advance our drugs to clinical trials. To that point, thank you for your research funding efforts.

Unfortunately, Cellceutix has been the victim of fraudulent and manipulative market activity that is becoming more and more prevalent, which is damaging and a growing threat to the biotechnology industry. There is no real secret recipe to the activity; “shorters” (traders/funds that profit by a stock price dropping) publish false and disparaging articles on the target company, attempting to scare shareholders into selling their position thus driving the stock price lower for their gain. Understand that there is nothing illegal about shorting, but “naked” shorting (where there actually aren’t any shares available to short) is, as are market manipulation and publishing articles that could be proven as libel by the definition of the law.

The people responsible for this type of activity have no concern for the damage they are causing to peoples’ portfolios or lives. Moreover, they seem to have no regard that they can be hampering drug development or respect for the fact that part of the funding may have come from the U.S. government. In our case, the article published by an anonymous author (pseudonym “Mako Research”) on the investment website Seeking Alpha was one of the most egregious attacks filled with unsubstantiated claims, unlearned scientific statements and misrepresentations I have ever seen. Perhaps even more amazingly, the Rosen Law Firm filed a lawsuit against Cellceutix citing the Mako article as the foundation of the claim, even though we have publicly debunked the article with facts. I am compelled to make you aware of the drain on the judicial system for what we consider a frivolous lawsuit. Following the defamatory article and lawsuit, the value of Cellceutix has been reduced by more than a quarter of a billion dollars. We are by no means the only company in this situation. We are aggressively fighting the lawsuit and will be pursuing sanctions if the case is not dropped. (The Rosen Law Firm press releases on the numerous companies they have targeted; http://www.businesswire.com/portal/site/home/search/?searchType=all&searchTerm=rosen%20law%20firm&searchPage=1).

That is not enough, though. I have a fiduciary and ethical responsibility to advocate for change for the good of our shareholders, the biotechnology industry and the patients whose lives depend on the development of new drugs for cancer and other diseases.

We have hired the law firm Ashcroft Law Firm, led by former US Attorney General John Ashcroft and Michael J. Sullivan, former United States Attorney for the District of Massachusetts, to not only defend us in this matter, but also to assist us in taking a stand as an advocate against similar attacks and subsequent meritless lawsuits that are becoming all too common in our industry (http://cellceutix.com/cellceutix-responds-to-rosen-law-firm/#sthash.D7PK6gCv.dpbs). The road of companies damaged by these immoral characters runs long and the impact on drug development is immeasurable. You don’t have to look hard to find companies that have struggled to raise capital or complete drug development after they have been unjustifiably attacked by bloggers with a short position that has shaken away investors. Many companies have been damaged by this immoral activity. This illegal practice is detrimental to medical research and it must be stopped.

Most respectfully,

Leo Ehrlich, CEO

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