Personally, I exited my position before the current valuation hit rock bottom for the same reason that has even been noted in court. The company paints an overly optimistic picture of its research and situation, and uses all its communication to convince investors of massive success. However, whenever the time comes to deliver on those promises, some random external factor inevitably appears, pushing the schedule back by years and justifying the need to bleed more money from investors. The explanations follow the same pattern, and the same Ponzi-like phrases are repeated every single time.
I kept up with this for 5 years, and during the last year, I repeatedly found myself thinking that nothing is as certain as the fact that Faron will always let you down. I haven’t had any trust in the CEO for a long time, and the old investor adage about avoiding family-run companies seems very applicable in Faron’s case.
I find it absolutely absurd how there is once again the same kind of mass fervor as there was during last summer and autumn. Critics are insulted, their motives are questioned, posts are flagged, and people are practically speaking in tongues in their zeal. Rarely does an investment case have as many red flags as Faron—in every round, the loudest voices belong to the bottom-tier participants who just joined.
Of course, I hope that the research will one day lead to a finished drug, but I consider that fairly unlikely.
So, the answer to your question is: the company management is not worthy of my trust. I wouldn’t buy a used car from Jalkanen, whose credibility sits somewhere between a shady car shark and a Rinta-Jouppi salesman.