Sounds sensational, yes? That’s the message the Securities and Exchange Commission conveyed in a press release this week. In an effort to enlighten investors, the agency released a list showing which companies do business with nations designated as a ‘State Sponsor of Terrorism’ by the US State Department. Who’s on the list? Cuba, North Korea, Iran, Syria and Sudan.

So the SEC notes that AstraZeneca deals with Cuba; Calpyte Biomedical is on the verge of selling into Iran; Canada’s Biotech Holdings cozies up to North Korea; and Cellegy Pharmaceuticals, Dr. Reddys Labs and Immtech Pharmaceuticals are in Sudan. There was no mention that Pfizer ceo Jeff Kindler visited North Korea recently.

“No investor should ever have to wonder whether his or her investments or retirement savings are indirectly subsidizing a terrorist haven or genocidal state. The law already requires companies to report on any material activities in a country the Secretary of State has formally designated a State Sponsor of Terrorism. Our role is to make that information readily accessible to the investing public. Making it easier to find significant information such as this by tapping the power of technology is central to the SEC’s mission,” says SEC chairman Chris Cox.

Depending on one’s politics, this may appear perfectly reasonable. There is, however, this disclaimer…..

….’The existence of a disclosure by a company concerning activities in one of the listed countries does not, in itself, mean that the company directly or indirectly supports terrorism or is otherwise engaged in any improper activity.’ So if you spend a few minutes reading closely, you learn that Calpyte is actually awaiting US government clearance to sell an HIV test in Iran or that Immtech is conducting a Phase III trial of a drug for African sleeping sickness in Sudan.

Taken at face value, such activities could be construed as examples of worthy endeavors - unless one is waiting for all Iranians to die of AIDS (as opposed to its government leaders in Tehran) or holds out hope that militants in Sudan’s Darfur region will die of sleeping sickness. The SEC may be following the letter of the law, but there’s nothing preventing the agency from doing a better job of qualifying its message so that every drugmaker isn’t automatically tarred with a very nasty brush.

Hat tip to Philly Inc