Deep Capture Forums

I am a long time stockholder in a small biotech. company that is just about to get approval for a new cancer detection drug.  The good news is really starting to come out.  To complete the project, the company needed $1 million more to cover extra financial costs associated with the development.  Naturally, they have a line of credit that they can access by swapping stock for cash.  In this case, they handed over 500k shares.  As can be expected the lender immediately put those shares on the open market.  However, about that time, (mid-March),  there was a wave of selling that brought over 2.5 million shorted shares into the float.  So the stock has gone from around $2.30 a share down to $1.60 a share where it worked its way back up to $1.95, yesterday.  After our conference call today, Thur. 29, April, I noticed that over 250k shares traded hands to the downside so that it currently sits at $1.74.   I am beginning to believe that manipulation is at work.  A few questions:  How could anyone profit by going short or naked short in a thinly traded market with a stock showing extreme potential for success and monetary gain? 
I believe that I read in Deep Capture that they had thwarted a naked short raid.  They did this by observing trading volumes and patterns over time that were used in naked short raids.  They observed these same patterns in a particular stock and were able to alert the public to this ruse.  Because of the attention the raiders decided that it was best to leave the stock alone.  Does anyone remember this episode?
Any help or information would be appreciated.