Ever since last summer, when a medical researcher reported that the zinc lozenge Cold-Eeze effectively reduces the severity and duration of colds, there's been a run on the remedy nationwide.
Now it turns out the researcher, Dr. Michael Macknin of the Cleveland Clinic Foundation, knew he was onto a good thing: He purchased stock in the lozenge manufacturer, Quigley Corp. of Doylestown, Pa., before his favorable research was published in July.
News of Macknin's research sent Quigley shares soaring from a low of 37.5 cents on the Nasdaq in April to a high of $18.50 on Jan. 9.
The uptick prompted a U.S. Securities and Exchange Commission investigation, which is continuing. The company's stock closed Thursday at $10, down $1.50.
The Cleveland Clinic confirmed Thursday that Macknin purchased 9,000 Quigley shares and then sold them after his paper appeared in the Annals of Internal Medicine, making about $145,000 in profits. He holds additional Quigley stock with paper profits of about $185,000. Macknin could not be reached for comment Thursday.
Dr. John Clough, Macknin's supervisor at the clinic, said Macknin informed superiors of his Quigley investments in advance and that Macknin's initial research was funded by $35,000 from the clinic, not the company. However, the journal article made no mention of the stock ownership.