Dendreon: The Paradigm Shift

May. 2.07 | About: Dendreon Corporation (DNDN)

Dendreon (NASDAQ:DNDN) is a stock from the backwoods that has moved to the forefront as a new day dawns at FDA. Dendreon is a company introduced to me last year by a friend of mine from the medical device field.

In layman’s terms, what makes Dendreon different? It is probably best answered with questions rather than answers.

• What makes an airplane different than a train or a car?

• What makes a laser printer different than a type writer?

• What makes a microwave different than a stove?

It’s best described as a paradigm shift, from the way diseases were studied, diagnosed and treated in the past. It offers hope for the hopeless by introducing new ways to treat deadly diseases. My interest was solely borne out of desire to make money and has turned into a passion for the Company, its advocates, and its potential benefactors.

Investing in Dendreon has opened my eyes to whole new world of financial manipulation by Hedge Funds, Market Makers, and Brokerages. We have seen analysts put sell rating and a price target of $1.50 on a Company with $1.50 per share in cash. We have seen Doctors who voted 17-0 on safety and 13-4 on efficacy take to outside publications (not peer reviewed). Two of the distinguished Doctors who voted against efficacy wanted a second vote and elected to take a public stance against the approval of Provenge after they cast their votes. (Remember, ‘hanging chads’?). I thought they got only one vote each. Incidentally, both those Doctors had to file for conflict of interest waivers to partake in the panel. Evidently, the other 13 distinguished panelists that voted yes were not competent.

Provenge is an ongoing study in a new era of treatments with a lot of promise. If it isn’t enough to overcome the establishment to new ways of thinking we have a capital market that surely wants to profit from killing this technology.

CASE in point:

• Dendreon has approximately 83 million shares.

• Institutions own over 27 million shares.

• 25 million share with long passionate stock holders.

• 34 million shares sold short as of 4/10/2007. (up from 26.4 million before panel approval)

• Nearly 620,000 call contracts at various strike prices for 62 million shares. Dendreon has traded over 722 million shares in the last 22 trading days, with 83 millions shares of total float. How do you do that?

Disclosure: Author is long DNDN

DNDN 1-yr chart