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Enigmatic ImClone

Rarely has a company reeling from corporate malfeasance been on the receiving end of so much good news. But such is the case with ImClone Systems (Nasdaq: IMCL  ) , as investors struggle for clues on the long-term direction of this enigma.

The past three days are a perfect example. On Friday, the SEC charged 82-year-old Jack Waksal -- the father of former CEO Samuel Waksal -- with selling ImClone shares after his son tipped him off that the FDA was going to deny the company's application for the cancer drug Erbitux. Samuel is already in prison, of course, and Martha Stewart Living Omnimedia's (NYSE: MSO  ) namesake is facing criminal charges in the case.

In the wake of all this, Erbitux continues to show promise after that initial stumble. ImClone and partner Bristol-Myers Squibb (NYSE: BMY  ) announced late Friday that the FDA has agreed to review the drug's application for accelerated approval and priority review. This means the agency will take action on the application and may approve the drug in six months or less.

The continued string of good news has rocketed the stock up over 400% off its year-ago lows. At $39, however, it remains well off its high of $73. With possible approval close at hand, why isn't the price higher? Perhaps management's bungling of the initial application soured potential buyers.

Obviously, getting a handle on fair value for this company is tough, but Paul Elliott (TMF Rael) offered some interesting considerations last month in ImClone, Hope, and Me.

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