Is having 10 employees for a pharmaceutical company an indicator that it is not a legit operation?

Question

There was case recently where a particular company's stock price had increased from little above $3/share to about $10/share within a course of 10 days.

At the time the stock price was close to $10/share, Citron Research released a report on the company with the title "SEC Must Immediately Halt this Stock Promotion Scheme". This led the company share price to fall to around $6/share. Citron removed their report the following day (it can still be found here).

One of the negative things about the company stated in that report is (emphasis added),

This is a $5 billion market cap company with 10 employees who claims to have the cure for COVID

Looking at the stock prices on this company it seems to have been around since before 2008.

Question I wanted to ask is, are there precedents on other pharmaceutical companies that were operated by a handful of employees and that turned out to be valuable?

Answer 1

Number of employees doesn't mean much. I could have 10 employees and contract out work done by thousands of others generating billions in revenue. That said, it apparently doesn't take that many people to work on a drug, I'm familiar with a couple small pharmaceutical companies with a low number of employees that have one or two drugs they are working on for years at a time. I wouldn't base investing decisions on number of employees.