Wednesday, May 9, 2007

Dendreon (DNDN) - I'm Angry, Really Angry

I haven't done any trading today aside from an unwind of the DNDN strangle. I then took the checkbook out and wrote a check to the hospice that took care of my father when he was dying of Prostate cancer and sent my profits from the protective put side of my strangle off to them. Otherwise, I've been sitting here in a state of shock.

I can't tell you how upsetting the FDA request for more information is to me. But I'm not the only one. I'm a subscriber to Michael Muphy's New World Investor newsletter. In an email flash he sums it up best, "Even if Provenge can be approved in 2009, I estimate about 80,000 men will die six to 36 months earlier than they otherwise would have, due to this decision. What really gets me about this decision is that there is little question about the safety of Provenge."

It now boils down to a two key scenarios for Dendreon. Either DNDN has to only provide interim survival data, which would push approval out to 2009, or the company will have to provide full phase III trial data, which would push approval out to 2011. These uncertainties have pushed shares of Dendreon to probe below the $7 level today. Needham and Company, one of the few Wall Street supporters of the company, has even had to temper its enthusiasm by cutting the stock to hold from buy. Says Needham, "While we continue to be enthusiastic about PROVENGE’s market potential for this disease setting, given the uncertainty of the development path and expected lack of significant news flow in the next 12-18 months, we are downgrading the stock to hold".

It was never about the money for me though profiting on something that seemed to offer hope was nice and I did on the committee approval. DNDN was actually a far too personal investment given my father's miserable death from prostate cancer. I am just dumbfounded that the FDA today turned its back not only on the potential tens of thousands of men who will die between now and the final decision for Provenge, but on the dozen, or so guys who appeared before the FDA panel a little more than a month ago. In their faces the panel said yes, but in an act of malicious cowardice the full FDA behind closed doors said NO for perhaps the next 4 years - and that's in spite of support from the FDA Commissioner who is a prostate cancer survivor.

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