When a relative -- I'll call her "M" to protect her privacy -- told me a few months ago that she and another relative who I'll call "D" were thinking of buying Dendreon Corp. (NASDAQ: DNDN), a biotech stock that at one time was a Wall Street favorite, I wasn't happy. The stock was getting pounded because of concerns about whether the Seattle-based company would get FDA approvals for its Provenge prostate cancer treatment. It turns out my skepticism was right and "M" and "D" were wrong.
Dendreon is basically a one-trick pony, and a money-losing one. As of June 30, the company had an accumulated deficit of $445.5 million. Its shares have plunged more than 50% since May, when the FDA didn't approve Provenge as had been expected.. The stock fell again in July after the company said the SEC was conducting an informal inquiry and that it was hit with a shareholder lawsuit.
Investors' hopes were rekindled again earlier this month after Dendreon released what was seen as promising results for its Neuvenge treatment for breast cancer. Forbes magazine, though, cautions against reading too much into these results.
"While the Neuvenge results were positive, Dendreon investors will have to be patient," the magazine said. "The drug's human trial remains in the early stage, meaning that Neuvenge has a long way to go before it nears Food and Drug Administration approval. Investors remain concerned that Neuvenge could go the way of Provenge."
Provenge remains Dendreon's bread and butter -- at least it would be if the company actually had products. The company made that point very clear in a recent filing with the SEC. "If we fail to obtain FDA approval for Provenge or fail to successfully commercialize Provenge, our business would be harmed and our stock price would likely decline," the filing said.
How true.
Hopefully, M&D will eventually recoup some of their losses so they can focus on more important things like spoiling grandchildren.
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Reader Comments (Page 1 of 1)
8-31-2007 @ 8:14AM
JB said...
You just fell out of a coconut tree
First of all the company is in "development stage". They are in the red because they don't have a product. Welcome to the biotech sector.
Anyone who invested in hope instead of reality got burned. Shame on them.
2 of the panelists had to sign conflict of interest waivers. It wasn't a fair assessment with 2 of Dendreon's competitors voting.
Every Forbes article has been decidedly negative. Are they correct or are they biased?
The comments on potential outcomes is required by the SEC. They as all other public companies must play by the rules.
They can bring Provenge to market anytime with a foreign partner but so far they have chosen not to. Apparently, they feel that it is necessarily approvable and are willing to wait.
If it doesnt get approved the company has contributed greatly to "new science" and has provided steps for others to get to a cure for prostate cancer.
Do your parents know that you're broadcasting your lack of preparation all over the planet?
8-31-2007 @ 2:05PM
daniel hext said...
yeah,what jb saidand throw in that the sec also turns it's back to the naked shorting criminality dh
9-01-2007 @ 1:03PM
dean said...
Your article is so biaseed towards negativity. If your relatives would have invested after may they would have had a return of over 35 percent with the recent run up in the stock. The company was blindsided by Dr Scher and other crooks at the FDA. Among other crooks in various Hedge funds kiting naked short shares in hope of driving the company down. Well buddy Dendereon is alive and kicking. And they are hiring for manufacturing positions. And best of all there treatment gives hope for cancer patients. So go ahead and make your negative statements without facts