Easton Pharmaceuticals Inc (PINK:EAPH) Aroused the Pumpers’ Attention

We received Wall Street Buzz’s email about Easton Pharmaceuticals Inc (PINK:EAPH) not more than a couple of hours ago and we were rather perplexed by the fact that the pumpers are once again trying to lift this particular ticker off the ground.

What caused our confusion? Well, we have seen previous promotions for EAPH and we can safely say that they didn’t go down too well with investors. Especially the ones that jumped in while the emails were flying around.

It was way back in 2011 and the pumpers were busy for quite a while. Between June 2011 and September 2011, there were quite a lot of emails sent and the trading, as a result, was frantic. The campaign was off to a promising start, when EAPH surged in the right direction, and the ticker hit nearly $0.30 per share. It was rather short-lived however, and when the pumpers went quiet for a while, it tumbled down to just $0.02. Then, the promoters tried again and during September and October they managed to revive EAPH a little bit, but as hard as their efforts were, they couldn’t bring it above $0.10 and it soon fell back down to a couple of cents per share.

Of course, there is a very good reason for this. The company back then was in a terrible financial state – they had no revenue, a massive accumulated deficit, very little in terms of assets and huge liabilities. We wrote about EAPH and you can see from our articles that the only way for the ticker was down.

Now, nearly two years later, Wall Street Buzz are trying to draw investors’ attention to this stock one again and we decided to check on EAPH and see if anything has changed since the last time we covered them. We were a bit underwhelmed to find that they recently published a notification of late filing, but still, we eagerly opened the quarterly report for period that ended on September 30 and we were waiting to see some promising figures in there. It wasn’t to be. Here’s a recap of the most important financials:

• current assets: $57 in cash
• current liabilities: $461 thousand
• no revenue since inception
• quarterly net loss: $62 thousand

All in all, it would seem that EAPH have not moved an inch for the last couple of years in terms of figures, but are things any different when it comes to products.

Well, in that respect, their report is somewhat confusing. They seemed to have signed all sorts of agreements that should allow them to produce, market and sell a wide array of healthcare products, and it would seem that half of them were abandoned and the other half are either not approved by the FDA or EAPH simply can’t be bothered to get the whole thing going. They do say however, that the product that is closest to some sort of commercial availability is a cream that is supposed to treat female sexual dysfunction. It’s called Viorra and according to the pumpers, the FDA say that it’s safe for use.

When we read through EAPH‘s financial report, however, we can see that they don’t expect to have a commercially available product until the middle of 2013 which, if you think about it, is not that bad. But it sounds a bit familiar. We opened their previous filings to see if their plans have changed over the years and, sure enough, they have. The report for the third quarter of 2010, for example, says that the product was supposed to be ready by mid-2011 but it’s quite clear that it wasn’t. Judging by their financial situation right now, we’re pretty sure that the statements to come will contain 2014 as a deadline.

In conclusion, the pumpers have presented us once again with a company that could serve as anything but a safe way to invest your money. Still, the ones who know a thing or two about penny stock promotions are probably aware that EAPH might gain some ground during the pump. Having all of the above in mind, though, we’re pretty sure that a potential rise will be followed by a massive crash, which is why you should be sure to carefully weigh the risks before jumping in on the artificial hype.