The "caveat emptor" maxim could serve as a warning to buysiders looking to invest in biotech. But with the soft public markets marking the return of the private placement, the roles of buyer and seller may be turned upside down. In this environment, let the company beware: many private deals are being pitched by financing shops running cold-call operations that target companies with less than two years of cash. Often, these people represent short-term money (read: flippers) that has no long-term interest in the sector.

"There are a lot of bogus deals floating around," said Wayne Rothbaum, a partner at The Carson Group. "Beware of people calling from Farms in Pennsylvania or people claiming that Battery Park is offshore," he said. "Shaman Pharmaceutical got a phone call from someone representing the King of Nigeria."