Beware the analyst with an agenda

http://aschoff.blogspot.com/2007/04/jonathan-aschoff-from-brean-murray-hes.html

Provenge is a drug to help prostate cancer patients in the late stage of disease. Dendreaon[sp] the company that makes Provenge is a bio tech company who recently received a positive recommendation from the FDA advisory committe[sp] that Provenge is safe and the the drug work[sp] to prolong survival.
Aschoff's firm had a sell or 'short' recomendation[sp] on this stock - target price of 1.50.
After the recommendation of the FDA approval pannel[sp] the stock flew up to 18 dollars. Aschoff has been on what seems to be a personal war path against Provenge ever since.
Friedman Billings analyst Jonathan Aschoff says he was just trying to get the real story when he impersonated a doctor in early March.

Here's another article.
http://www.marketrap.com/article/view_article/91112/jim-chanos-jonathan-aschoff-and-more-on-the-dendreon-saga

When the FDA’s advisory panel voted in favor of Provenge, most Wall Street research analysts were predicting a bright future for Dendreon. But as naked short sellers piled on with ever increasing gusto, hedge fund managers continued to whisper in reporters’ ears. And two Wall Street analysts did more than whisper – they shouted, day after day, that Dendreon’s treatment for prostate cancer was doomed.

One of these analysts is named Jonathan Aschoff, and he works for a financial research outfit called Brean Murray Carret & Co. The day after the advisory panel vote, in an interview with Reuters, Aschoff made the long-shot prediction that the FDA would not approve Provenge, but would instead ask Dendreon to supply additional data showing that the treatment was safe and effective–a process that could take years. Soon after, Aschoff told other media outlets that the FDA would set a “dangerous double standard” by approving Provenge because the treatment “did not meet its primary goal in two Phase III trials.”
During the first days of April 2007, Aschoff was everywhere, continuously repeating this notion that the FDA would set a “dangerous double standard” by approving Provenge. On April 9, Aschoff reiterated his “sell” rating for Dendreon, setting a target for the stock at a mere $1.50, which implied that the stock would lose more than 90 percent of its value by the end of the year. Reuters, Associated Press, CNBC and other media dutifully reported Aschoff’s comments as though they shed light on the merits of Dendreon’s prostate cancer treatment.

Aschoff’s performance raises a few basic questions. The first is, how did a Wall Street analyst know that it would be “dangerous” to approve a medical treatment? It is an odd day, indeed, when the media turns to Wall Street for wisdom on matters of science and health.
The second question is, why was Aschoff so confident that the FDA would not approve Provenge? Given that the FDA had followed its advisory panels’ decisions in 97% of cases, and in 100% of cases involving drugs for dying patients, Aschoff’s prediction seemed rather far out. What did he know that the rest of the world did not know?

One more question: Which hedge funds were paying Aschoff’s bills?

Note: shares of DNDN recently peaked above $58 after FDA approval, and have settled in at $36 as of today.

See disclaimers in the side bar.

Disclosure: no current position in DNDN, last exit was at $58. A family member still owns shares of DNDN.

ARNA analysts

Let's break down who got it right and who got it wrong on VVUS and ARNA.

http://www.streetinsider.com/Trader+Talk/Arena+Pharmaceuticals+%28ARNA%29%3A+Upgraded+to+Overweight+at+J.P.+Morgan/5811273.html

Thumbs up to Cowen & Co. and Piper Jaffray for getting it right, and understanding the importance of safety in FDA approval decisions.

Thumbs down to JPMorgan and Adam Feuerstein of thestreet.com for getting it completely wrong. At least JPMorgan and Adam are smart enough to reverse course on ARNA--after Qnexa's rejection.

Big thumbs down to Rodman & Renshaw analyst Elmer Piros for downgrading ARNA with a price target of $1.

Recall Jonathan Aschoff, a Brean Murray Carret & Co. analyst, at one time had a sell rating on DNDN with a $1.50 price target. DNDN shares recently had a high of over $58.

Is Wall Street crooked? You decide.