ITonis, Inc. (PINK:ITNS) Steamrolled to Under a Penny After Pump

Several hundred thousand dollars were handed out to pumpers to promote ITonis, Inc. (PINK:ITNS). It seems the money spent was disproportional to the success of the pump, as yesterday ITNS sank like a rock, closing over 63% down and dipping under a penny per share, about 50% below its pre-pump levels.

We covered ITNS a couple of days ago and warned our readers of a large $150 thousand pump from Tuesday evening targeting the company. On Wednesday the stock gapped up and wobbled around $.025 throughout the day, giving hopeful investors little chance to make a profit. Yesterday was a downhill race, with huge selling taking place and the stock generating a volume of over 63 million shares – almost double that of the previous day.

There were several red flags about the company that could have given traders a heads-up. The promo mails touted the formation of a new pharmaceutical branch of ITNS, headed by Mr. Charles Hensley – inventor of the Zicam cold remedy, described in the email as one of the most successful.

Anyone who runs a quick search for Zicam would find out that back in 2009 the U.S. Food and Drug Administration issued a warning to consumers to stop using the nasally delivered versions of Zicam as those could cause impairment or loss of their sense of smell, as reported by the NY Times. The resolution of the issue was a total of $12 million paid as settlement under 340 lawsuits. ITNS have recently announced their plans to produce a new anti-nausea nasal spray with Mr. Hensley at the helm. This plan is made all the more awkward, considering what happened to Zicam nasal spray.

The last financial report filed by ITNS is for the period of nine months ending August 2012 – hardly current information by any measure. The numbers contained in it are also less than exciting:

 

• $160 in cash
• $559 thousand in current liabilities
• zero revenues
• cumulative net losses as of Aug. 31, 2012 – $5.3 million

 

The report also details the issuing of over 38 million shares to company officers as part of their payment plan. The rest of the report is a classic example of pink sheet alternative-standard reporting with confusing texts concerning an increase of authorized shares – an event that took place months before the issuing of the report. The company has 1 billion common stock authorized, even though their OTCMarkets page shows the number as 300 million.

Traders are advised to do their own research and never trade solely on paid recommendations that end up in their email’s inbox.