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Our Last Line of Defense Against Ebola?

On October 9, U-T San Diego reported that Mapp Biopharmaceutical enlisted a company to help produce the Ebola drug cocktail, ZMapp.

And widespread speculation was that iBio (IBIO) would be identified as Mapp’s partner.

As a result, iBio’s shares spiked more than 66.6% on Columbus Day.

The Delaware-based biotech company closed the trading day at $2.45, an increase of more than $0.98 from Friday’s closing price of $1.47.

More than 49 million shares changed hands, compared to the three-month average of just over 600,000.

This proves without a doubt that hysteria about Ebola has reached Wall Street.

Don’t Get Caught in This Terror Trap

I’m sure you’ve heard by now that a nurse in Dallas was diagnosed with the Ebola virus after having extensive contact with a patient who later died of the deadly virus.

The news significantly deepened concerns about an Ebola outbreak thas have plagued the United States since late September.

As you can see from the chart below, iBio shares have blasted higher on both Friday and Monday.

Ebola Hysteria Hits New Level Among Investors: iBio (IBIO) Shares Reacting to Ebola Fears

Now, you might be asking what role in the fight against Ebola iBio plays…

And that’s an important question, here.

You see, iBio has focused its efforts on the commercialization of its proprietary plant-based protein expression technology, called iBioLaunch. This technology differs from most traditional biotech research that focuses exclusively on mammalian cells.

iBioLaunch is a platform technology for developing therapeutic proteins and vaccines, such as monoclonal antibodies, that – when combined with the company’s iBioModulator technology – enhances the potency and duration of therapeutic vaccines.

In the long term, iBio’s technology shows a great degree of promise in the fight against Ebola and other diseases.

You see, a recent edition of the Proceedings of the National Academy of Sciences (PNAS) report confirmed the concept of using plant-based cocktails of monoclonal antibodies to prevent lethal disease in rhesus macaques.

Unfortunately, the infrastructure for producing plant-based biologics remains in its infancy.

So by buying into the hype of iBio’s “potential” inclusion as Mapp Biopharmaceutical’s partner, investors are needlessly jeopardizing their wealth.

Besides, the U-T San Diego article clearly states that Mapp Biopharmaceutical is looking for a partner to scale up traditional biotech processes by using genetically modified mammalian cells derived from Chinese hamster ovaries developed in sterile tanks.

And since iBio has no means of developing these cells with its current technology, it’s abundantly clear that speculators are ignoring the facts. Instead, they’re hard at work trying to push this (and other stocks) higher on fears of the Ebola virus alone.

Again, the long-term future for iBio may look bright. But any investment at this time will almost certainly prove to be a lost cause.

Avoid the hype, and protect your portfolio from “viral” stocks looking to capitalize on unfounded rumors.

Good investing,

Richard Robinson

Richard Robinson

, Ph.D., Equities Analyst

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