Tuesday, May 26, 2020 3:07:51 PM
Had to smile when they claim that investors were misled by KB stating that DECN received Pre-EUA number for its submission. What? Are you kidding. PRs continued to clearly say product in development and had to go through rigorous testing, but the SEC feels someone would misinterpret that as reason enough to Suspend Trading? hmmm not too strong of an argument, reaching in my opinion.
Most damaging statements in SEC filing are claims of past history of KB making exaggerated or false statements.
But even the segment that they put front and center needs to be read twice and is not necessarily a convincing blow:
Sounds like an open and shut case on first reading, hence urge for sell-off. But price holding up remarkably well. Why? Don't know but here are some possible reasons for these answers even an outsider would suggest:
1. KB is the US rep/contact for The Bio. The test kits were designed by Musho in consultation with others and all test materials and manufacturing are done in South Korea.
So when pressed over the phone in April, did he have test kits to sell, manufactured and boxed - no.
- had he seen them? No, because the "kits", not the strips, had not been printed, boxed and manufactured yet. He doesn't have them in CA. He's not a scientist. what would looking at them do for him? They will look much like the other test strips. He is communicating with the scientists and those doing the design and testing, then taking their word on whether or not it works. Lots of CEOs do that.
- he didn't know how many he could produce for varying factors at that time, including getting the materials on time, partnerships etc.
- the fact of needing materials and production being dependent on obtaining those materials were stated in PRs and/or disclosure documents (no surprise here - he had publicly stated it)
So, while the SEC filing is a punch, it remains to be seen if it is a knockout punch or a temporary knock down, from which he rises before the end of the count.
If the SEC files the documents on time, we should see the response in less than 2 weeks and possibly other news as well. The game is not over yet.
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