Oh, the Dendreon (DNDN) investor message boards are on fire! And my inbox has a few sparks. Matthew Herper at Forbes wrote a piece today daring to question the integrity of the all-important data due out sometime next month on DNDN's prostate cancer treatment Provenge. Interestingly, though, in the first half of the trading day it doesn't seem to be hurting the super volatile shares.
Matt talked to four "top statisticians" who think that when Dendreon put out this press release last year offering a sneak peek at the midterm test results, it might have compromised the end result and could possibly force the company to go back to square one. That'd be a difficult move for a baby biotech whose fate will be determined by the Provenge study and has a finite amount of cash.
Dr. Mark Monane is the top biotech analyst at Needham and Company and he's been following Dendreon for a long time. In fact, he's the guy who first introduced me to the story when I was just a biotech cub several years ago. Anyway, over the phone he told me there are a couple of reasons why he thinks the press release could not have influenced the study. He acknowledged that the sneak peek was a little more "fact filled" than most interim data announcements. But he said the patients had long ago finished getting the Provenge. So, it's not like this was an ongoing treatment. They get a few doses early on and then they're done. And Dr. Monane added that whenever you're looking to measure extra survival that there is going to be what he called a "post-treatment effect."
"I don't disagree with the reviewers (the statisticians quoted in Forbes) comments, however I think there are special conditions in terms of this trial that may minimize those effects," Dr. Monane said. Needham makes a market in DNDN and Monane has a "Hold" rating on the stock.
When the final results come out in April it will be a binary event. In other words, if the data are good, the stock will likely skyrocket. If they're bad, the shares, which are up about two bucks on higher-than-normal volume over the past few weeks, will probably tank.