Dendreon: Media Spotlight Generates Hype and Hysteria

My post on Dendreon (DNDN) a couple of days ago attracted a strong response, both critical and approving. But I am not surprised at the level of hype the article generated; Dendreon has been a gold mine for financial bloggers and sites for the last few months.

Adam Feuerstein and James Altucher can both attest to the large following their Dendreon posts attract. So can 247WallSt, and so can I.

I follow Adam's writing on a regular basis, and find his analysis both accurate and informative. He has a great outlook on the reality of various investment situations in biotech. But his criticism of the media's pumping of Dendreon can be viewed as hypocritical in my view. His post has surely attracted a large audience, and I am sure he knew it would before he published it. Just like I know this post will surely do the same.

I am not suggesting that his intentions were to generate hype and cause controversy, but he is in the media spotlight, and thus, hype is always good. Just like how the major news stations cover the Paris Hilton imprisonment saga for ratings, so do bloggers and financial sites with Dendreon.

What do I think of Dendreon? I have never invested in it, and will never touch it. Why? Because I shy away from media hyped stocks, and gravitate towards lesser known healthcare companies, like Heska (HSKA), Opko (OPK), and LifeCell (LIFC), which have made me a lot more money than Dendreon would have, all without the heart wrenching volatility.

Regardless, I still do believe that cancer vaccines will prove successful in the long run based on preliminary survival data, and so will the companies developing them, whether it is Dendreon, Cell Genesys (CEGE) or Geron (GERN).

Disclosure: Author owns stock in HSKA and LIFC.

RELATED READING:

- Dendreon Deservingly Jumps on New Cancer Vaccine Report
- Options Expiration Weighing on Dendreon
- Cell Genesys Should Not Trade With Dendreon!

Comments

[Jim Glazen:]

Don't flatter yourself dude. Your last Dendreon article had no responses until I spiced up the comments section. Still, it was only 5 responses and I was 2 of those.

I made a fortune on Dendreon by taking a monster long position in the $4 range before the FDA panel and hitting the exit button as soon as I saw Mitch Gold, Dendreon's CEO bailing out.

2007 Jul 05 05:29 PM

[hisham ayoub:]

The success of an article, to your complete and utter surprise, is not only measured by the number of replies on SeekingAlpha. The article is first posted on BioHealth Investor, where the number of hits is what matters.

Second, I never suggested that no one made money on Dendreon. In fact, I said that it will probably go up as the final study results pour in. If you read the article closely it mentions the other stocks as alternatives to Dendreon based on the relative lack of volatility.

Also, if you check out the charts for OPK, LIFC, and HSKA and compare them to that of DNDN, you would notice a huge difference in the trend; a consistent up trend NOT a single volatile spike.

Im glad you made money trading DNDN, and I believe there could still be more to be made, but DNDN is not for me, I like stocks to rise big, but slower.

2007 Jul 06 12:00 AM