The Bull Case for Dendreon's Provenge

May. 2.07 | About: Dendreon Corporation (DNDN)

Below are the primary reasons why Provenge from Dendreon (NASDAQ:DNDN) will be approved by the Food and Drug Administration before or on May 15th.

Much has been lost in the recent postings here on Seeking Alpha, in which the Short Case has continuously been made.

Here are facts about the Provenge treatment paradigm. You, as a rational investor, may decide.

1. Provenge is designed for late stage Prostate Cancer patients.

2. The ONLY other "drug" is Taxotere. Taxotere is chemotherapy. Chemo can kill you.

3. Many patients choose death over chemo.

4. Provenge's side effects are "flu-like" symptoms lasting 2-3 days.

5. Provenge missed on Primary Endpoint of TTP (Time to Progression). Dendreon's trial study used an arbitrary p value of p = or less than .05. Study 9901 barely missed this endpoint tolerance of p =.052. That said, if TTP p value was .05, not .052, then it is highly likely that Provenge would have been approved by the FDA several years ago. In addition, the FDA, only months ago, came out with guidance that TTP is not an optimal measurement for immunotherapy trials such as Provenge.

6. TTP is an early measurement. It turns out Provenge-treated patients lived longer. 33% of Provenge arm lived three or more years, yet only 11% of "placebo" patients were alive after three years. Eduardo Garcia spoke at the AC more than seven years after receiving Provenge.

7. Can you fake survival? Not likely. FDA statisticians said a 1 in 40 chance survival was a fluke for the original 9901 trial, as well as the 9901 + 9902a combined data pool.

8. On March 29th, the FDA Advisory Committee voted 17-0 on the safety of Provenge and 13-4 on the efficacy of Provenge. AT LEAST two "NO" voters (Dr.s Scher and Hussain) had to get conflict of interest waivers from the FDA in order to vote. These were the same two COI doctors who wrote "letters" to the FDA saying that more data was needed. These two "doctors" specialize in chemo, a likely direct competitor to Provenge.

9.These "letters" were "leaked" to a website called The Cancer Letter. The Cancer Letter makes the husband and wife owners $500,000 yearly. While leading a dual role as Head of the National Cancer Institute and the FDA, Dr. Von Eschenbach canceled the NCI's subscription to The Cancer Letter. I guess Von E didn't think The Cancer Letter was important or useful back then, and I doubt he has changed his mind since in the interim.

10. Dr. Von E is a PC survivor. His dad had PC. He is a Urologist and a patient advocate. He proclaimed "our goal is to make cancer controllable and survivable by 2015".

11. After three straight "NO" efficacy votes, the 4th panelist --- Dr. Mule, Chair of the Advisory Committee --- expressed concern with the wording of the question. Dr. Goodman, second in command at the FDA, quickly revised the question to meet FDA Guidelines, as dictated by the USC. Dr. Whitten, third in command at the FDA, read the correctly worded question. 13 of 17 panelists --- 76% --- agreed that Provenge showed substantial evidence of efficacy. How can the FDA ultimately ignore the Advisory Committee's final findings?

12. Can number 11, by any stretch of the imagination, point to the FDA NOT wanting to approve Provenge? Does the FDA purposely want to look like uncaring bureaucrats?

13. Dendreon is one the most heavily shorted stocks on the market. Many people think/thought/want Dendreon and Provenge to fail. It takes courage to join a Paradigm Shift. To wit, after Provenge is given full approval before or on May 15th, Dendreon will fly for months and years to come.

14. Provenge will be approved by May 15th. Based upon my analysis, I give a 60% chance that Provenge will be approved before May 3rd. I told my colleagues after the AC vote that Dendreon and Provenge would be run to $25 and said anything under $15 would be cheap, cheap, cheap. The trading range has been between $15 and $25 since two days after the panel.

I now predict Dendreon will see $35 or more the day of approval, $60 EOY 2007, $80 within one year from today, $100 by the end of 2008, $200 by the end of 2010, $400 by the end of 2012, and over $500 by the end of Von E's 2015.

How's that for the next DNA?

Disclosure: Author has a long position in DNDN

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