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Phony Cancer Cure Scam! Execs Raked In $4.1M on Fake Drug!

  
February 6, 2026


  
  

    

      
      

    

  




  



        


SEC v. CBA Pharma, Inc., Wayne Michael Putnam, Louis "Buzz" Carmichael — U.S. Securities and Exchange Commission Litigation Release No. 26479, dated February 6, 2026.


The SEC charged CBA Pharma, Inc., a Kentucky-based biopharmaceutical company, and two of its executives with defrauding investors in a securities offering. The company and its executives allegedly misrepresented the effectiveness and FDA approval status of their cancer drug, CBT-1, raising approximately $4.1 million from about 160 investors. The SEC seeks permanent injunctions, disgorgement, interest, and civil penalties.




In Plain English
Imagine a company selling shares in a new medicine it claimed was almost ready for approval and could treat cancer. The company and its leaders told investors it was in the final stages of getting the "okay" from the government's health agency. However, the truth was that the government agency had already told the company the medicine wasn't proven to work and had even withdrawn its application. The company and its leaders are accused of lying about this to raise money, and investors lost millions.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.


How the Alleged Scheme Worked
  1. Develop a Cancer Drug CBA Pharma, Inc. worked on a drug called CBT-1, which they claimed could help cancer patients by preventing resistance to treatments like chemotherapy.
  2. Seek FDA Approval The company aimed to get approval from the U.S. Food and Drug Administration (FDA) to market CBT-1 as a cancer treatment.
  3. Receive FDA Warnings As early as 2013, the FDA informed CBA Pharma that its application for CBT-1 had significant issues, including a lack of evidence showing the drug was effective. The FDA also noted that the company's website misleadingly claimed efficacy.
  4. Fail to Rectify Deficiencies CBA Pharma did not complete the additional clinical trials or fix the other problems the FDA identified. By April 3, 2023, the FDA had officially withdrawn CBA Pharma's drug application for CBT-1.
  5. Launch a Securities Offering From April 2023 to February 2024, CBA Pharma, led by President Wayne Michael Putnam and VP Louis Carmichael, conducted a "Royalty Offering" to raise capital.
  6. Misrepresent Drug Status During this offering period, Putnam and Carmichael allegedly told investors that CBT-1 was in the "final stages of obtaining approval from the United States Food and Drug Administration ('FDA')."
  7. Conceal FDA Rejection Despite knowing CBT-1 was nowhere near approval and that its application had been withdrawn, the defendants allegedly failed to disclose these critical FDA communications and warnings to potential investors.
  8. Raise Millions Fraudulently Through these alleged misrepresentations and omissions, CBA Pharma, Putnam, and Carmichael raised approximately $4.1 million from about 160 investors across the United States.
  9. Cause Investor Losses As a result of the alleged fraudulent scheme, investors lost approximately $4.1 million.


The Enforcement Action
On February 5, 2026, the SEC filed charges against CBA Pharma, Inc., Wayne Michael Putnam (president), and Louis "Buzz" Carmichael (vice president of capital markets) in the U.S. District Court for the Eastern District of Kentucky. The SEC alleges violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctions, disgorgement, pre-judgment interest, and civil penalties against CBA Pharma, and permanent injunctions, civil penalties, and bars from participating in securities offerings against Putnam and Carmichael. The SEC acknowledges assistance from the U.S. Attorney's Office for the Eastern District of Kentucky, the FBI's Louisville Field Office, and the FDA.


Named in this action: CBA Pharma, Inc., Wayne Michael Putnam, Louis "Buzz" Carmichael.


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