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.

FDA approves Provenge

Shares of Dendreon (symbol "DNDN") surged today after the FDA approved Provenge for treatment of advanced prostate cancer. Search DNDN in this blog or Google "Deep Capture Dendreon." It's a fascinating story. It includes an analyst who predicted DNDN shares would tank to $1. Jim Cramer and much of Wall Street were negative on the company when it was trading around $3. Today, it hovers above $45, before trading was halted. Laugh out LOUD!

The company has had a tough, arduous, long road, with many opponents--some crooked, including the FDA, short hedge funds, market makers, investment banks, regulators, analysts, and captured journalists--even organized crime syndicates according to conspiracy theorists. But in the end, the white hats won, and many lives will be saved.

This is not a profit-making celebration--this is a confirmation that patience and conviction are sometimes rewarded. Many long investors suffered for years; using luck and some skill (along with courage), I was able to time the trade so I would only be exposed to regulatory risk for one year.

This rollercoaster is not for the faint-hearted.

See disclaimer on side bar.

Disclosure: entry points for DNDN between $4 - $7 in April 14, 2009. Planning to exit a percentage of position at approximately $45 on April 29, 2010.

Edit: after resumption of trading, DNDN is now trading at $52!

Edit 2: Disclosure: another tranche sold at $57.55 on April 30, 2010, purchased at $7.28 on April 14, 2009.

Missed on ONTY

Shares of ONTY gapped up this morning on positive preliminary results for Stimuvax, a lung cancer immunotherapy.

http://www.tradingmarkets.com/.site/news/TOP%20STORY/2383852/

Based on this article reporting positive results on breast cancer clinical trials, I contemplated purchasing some ONTY shares over the weekend. However, it soared over 30% this morning before I could get my buy order filled. I will hope for a pullback, as ONTY has as much, if not more upside potential than DNDN, the prostate cancer immunotherapy company we profited from back in April.

DNDN's Provenge had a 22.5% overall survival benefit above advanced prostate cancer (PC) patients on placebo, and patients on Provenge lived 4.1 months longer on average, which is significant considering late-stage PC life expectancies are short. Once approved by the FDA, which now appears likely, Provenge will extend the lives of many PC patients, and labeling will be extended to early-stage PC patients, further increasing the 90% success rate for that segment.

In June, ONTY announced a 17.3 month median survival benefit for Stage IIIB non-small cell lung cancer patients above those on placebo. With multiple shots on goal with Stimuvax (lung, breast, prostate, and colorectal cancers), and a healthy pipeline of other oncology drugs, ONTY shares have some serious long-term upside potential.

This is not a recommendation.

Disclosure: I have no position in ONTY, and a long position in DNDN.

Dendreon revisited

Adam Feuerstein, an analyst on the street.com, who was previously bearish on DNDN, offers the following bullish analysis on Dendreon:


http://www.thestreet.com/story/10503521/1/dendreons-gold-whats-next-for-provenge.html

Interesting tidbit on commercialization prospects:

"Most people are modeling Provenge along the lines of Erbitux now," said Gold, referring to the cancer drug from Eli Lilly(LLY Quote) and Bristol-Myers Squibb(BMY Quote). "I think Erbitux costs around $80,000 a year now. ... I'm not saying that's going to be the Provenge price, but that's what analysts and people on the Street have in their heads when thinking about a Provenge price.

"If you use that assumption and say that the market size is 100,000, men then the total commercial market opportunity for Provenge is $8 billion."

Gold on Provenge in Europe:

"We have only had superficial high-level discussions with the Europeans, so the European regulatory strategy and European commercial plans are things that we're really going to look for a partner to oversee. Dendreon is going to focus on the U.S. market. "

Gold on signing a partnership for Provenge or entertaining acquisition offers for the entire company:

"We are committed to commercializing Provenge ourselves in the U.S. and finding a partner outside the U.S. ... If someone puts an offer on the table for the entire company we have a fiduciary responsibility to consider it, but that's not how we're building the company or how we're planning on building the immunotherapy franchise.

I'm thinking a buyout offer of $300 a share seems reasonable. :-)

Even though myself and several of my friends and family bought DNDN in the single digits, I'm already regretting selling some shares at $25.

This is not a recommendation. Do your own diligence. Investing in equities are inherently risky, especially the volatile biotech sector. Good luck to all.

Next pivotal event for DNDN

Tomorrow (April 28) at 12:20 pm Pacific time, Dendreon will present detailed results of Phase III clinical trials for Provenge, a prostate cancer immunotherapy.

Shares of DNDN tripled April 14, when CEO Mitchell Gold presented "unambiguous" top-line results that Provenge met its 22% primary endpoint survival benefit above the placebo control group.

Mike Huckman of CNBC is preparing several updates and interviews from Dr. Gold at the American Urological Association conference in Chicago. A "clear hit" as quoted by Dr. Gold two weeks ago, could cause shares of DNDN to soar even more. A disappointing result could cause shares to tank. Given his positive, upbeat announcement, while offering no metrics, I would be surprised if the survival benefit guideline was not surpassed by a wide margin, as that would invite shareholder lawsuits.

http://www.cnbc.com/id/30389525

Notice Huckman's comment on shares possibly being halted again. This could potentially be music to those long on the shares, as that occurred April 14 in pre-market trading, when the shorts got squeezed. Look for fireworks tomorrow.

Dendreon interview on CNBC

http://www.youtube.com/watch?v=wm4o1fYtCTQ

FDA--Friend or Foe?

From the CaretoLive website. Activism is alive and well.

Provenge went before the FDA for approval over 2 years ago. A panel of experts was convened, who voted it 17-0 safe, and 13-4 substantial evidence of efficacy. Two “doctors”, namely Howard I Scher, and Maha Hussain, from the chemotherapy industry put on the panel by Richard Pazdur aka “the cancer czar”, both had severe conflicts of interest, and had to sign waivers although they conveniently left out many of their conflicts. They were both very vocal at the panel, that they needed more proof. Provenge has already been through over 10 years of Phase I, II and III testing.

The “doctors” lobbied the FDA to delay approval. Letters were leaked to the same inside non peer reviewed source that published the imclone erbitux non approval, sending Sam Waksal, CEO of Imclone, and Martha Stewart to jail. We believe that Richard Pazdur of the FDA was the “leaker”. Richard Pazdur of the Chemotherapy, Radiation side of the FDA, ran roughshod over the approval process, (passing notes to one of the conflicted doctors etc), even though Provenge is a biologic agent and did not reside in his division. Imclone’s Erbitux was subsequently approved for colon cancer, unfortunately not in time to help those who died waiting. A congressional hearing was called over Imclone.

We had several Congressmen call for a hearing over the Provenge debacle, but John Dingell of Michigan refused to hold it. His wife is tied to the cancer industry. Congressman John Dingell (Michigan) and Frank Pallone (New Jersey) decided against a Congressional hearing for all the wrong reasons. You can read their response to those calling for hearings. 2/13/08
micha001.pdf
Three Congressmen, Mike Michaud (D) of Maine, Dan Burton (R) of Indiana, and Tim Ryan (D) of Ohio called for a congressional hearing into the conflicts of interest and what went wrong at the FDA causing the delay of Provenge. (click this link) Read the Congressional Letter calling for a Hearing 12/13/07.

Besides, Congress is too busy holding hearings on steroid usage in baseball players, which nobody has died from. Who cares about 30,000 sick old American men. In reality, men are dying from prostate cancer in their 30’s and 40’s as well.

The really sick people are those running the FDA. They oversee a corrupt, dysfunctional bureacracy, with little care for the lives and health of the citizens of the United States. They are more concerned with power and lining their own pocketbooks.

Billions of dollars paid out to pharmaceutical companies, hospitals, stock holders, and Wall Street titans, will be lost, if the entrenched Oncology treatments are replaced by immunotherapies. This is an uphill battle, but one we need to fight, for all of our sakes.

Dendreon has immunotherapies for breast cancer, colon cancer, etc, on the back burner, due to the delay in Provenge approval, causing a depletion of their research and trial money. This is the way wall street plays the game and influences the FDA decisions. Delay and destroy. If not for Care To Live Provenge would have been long gone, possibly even being bought out by a larger company, whose goal would be to throw it in the trash heap, to ensure nothing interfere with their profits from the current toxic, debilitating treatments and the billions spent managing their horrible side effects.

The common protocols when you are diagnosed with prostate cancer is usually either removing your prostate gland, or some type of radiotherapy such as implanting radioactive seeds in your scrotum, which kill the cancer cells. Unfortunately they kill they healthy parts of your immune system too, and radiate your vital organs. You may also opt for watchful waiting now called active surveillance. Most men are encouraged to be treated. If your cancer progresses, they will give you hormone therapy, which is really female hormones, to try to supress your testosterone. All men who go on hormone therapy, will eventually fail, unless they go on to die from something else.

Provenge has show survival in 20% of the sickest men, those in late stage, who have already had either their prostate gland removed, or been radiated, and also had hormone therapy which is no longer working. These are men whose cancer has already metastacized to their bones and organs. Imagine what it might do, were it given to men earlier in their diagnosis. Once an immunotherapy is approved, it will be a paradigm shift in the way cancer is treated.

Michael Milken, runs the world’s largest prostate cancer charity in the world. He has been silent during this entire fiasco. The Provenge interim results of another Phase III trial were recently released, showing 20% survival. Not a word from him or his Prostate Cancer Foundation. It is apalling but not surprising. Milken, is a convicted felon who sent time in jail for stock manipulation, and has investments in Provenge competitors. His “faster cures” nonsense, rings hollow with us. He helped fund the Proquest Investment fund. He is busy shaking his can everywhere, asking for more funding to begin research 10 years away from approval, but has nothing to say about Provenge, which is ready, willing and able to be used RIGHT NOW! It is an abomination.

DNDN conference call

As I and other investors hoped for, Dendreon CEO Mitch Gold revealed "unambiguous" top-line results that Provenge met the pre-defined primary endpoint for increased survival benefit for late-stage prostate cancer victims in the IMPACT Phase III clinical trial. Shares jumped up over 200% in pre-market open trading. This was a victory for investors and all cancer victims and their families, as other treatments for breast, colorectal, and kidney cancer are also in Dendrean's pipeline. Their cancer immunotherapy platform is a game-changer, and a much better solution than traditional chemotherapy treatments, which carry toxic and adverse side effects.

This paves the way for a New Drug Application (NDA) by the end of 2009, and FDA approval in Q2 2010.

Shares of DNDN halted in after hours trading

Dendreon, a Seattle-based biotech specializing in cancer immunotheraphy, will be announcing top-line results of a phase III clinical trial for Provenge tomorrow. The pivotal metric is whether patients with prostate cancer will have a 22% survival benefit from Provenge vs. the place control group.

An advisory panel gave a recommendation to the FDA of approval in 2007 based on a positive safety profile and promising interim survival benefits. But in a controversial move (especially for life-threatening oncology treatments), the FDA did not approve Provenge, seeking more results for this IMPACT clinical trial.

The results will be announced tomorrow in a conference call at 6 am PT. If Provenge meets its 22% survival benefit benchmark, the share price for DNDN will explode. If they miss their target, the share price could collapse to almost zero. Such is the life of a biotech microcap company.

If IMPACT proves effective, it could open the doors for immunotheraphy of other cancers, and could be a game-changer for oncological treatment. For investors and patients, let's hope this one is a winner.