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Dendreon Corporation

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Msg  406911 of 488028  at  6/30/2011 4:36:49 PM  by


my mid year review of DNDN

 INTRO Here's my semi-annual exercise to see if I remember why I own the stocks I own, and so I can check back and see if their stories have changed. I post in case it helps others too.

DNDN (market cap $5.75B)
Dendreon is a high-tech bio-tech that develops and sells cancer treatments based on immuno-therapy, teaching the body's immune system to counteract the cancer. Their first treatment (Provenge) was approved for treating prostate cancer. Provenge seems to be more effective, have lower side effects, and a lower price (even at $93,000) than conventional chemo and radiation. The technology can be extended to treating other cancers (e.g. breast, lung, ovarian, colo-rectal, renal, etc.). Clinical trials have begun for breast cancer (but set aside because of a crowded market) and bladder cancer (ongoing). The company has retained all rights to the treatments, is opening additional treatment centers, and is expanding into Europe.

DNDN is a story stock, a battlefield stock. The company may have run afoul of the conventional industry and financial institutions. Chemo and radiation are billion dollar businesses that subsequently have much invested in maintaining their revenue streams. By not partnering, Dendreon has retained all rights, but they also may have snubbed the establishment that looks to profit from startups by stepping in after the hardest work and greatest risk is past. Conspiracy theorists have much to work with, and while they all can't be right some probably are. See Deep Capture for one extensive point of view.

I think the stock is undervalued as if the company's potential sounds too good to be true, and therefore the greater financial community is holding back. The buyout value of similar companies have equivalent stock prices of $80-$160, which suggests a much higher valuation than the current stock price is possible.

DISCLOSURE LTBH since 2002 and glad to be indirectly part of a dramatic improvement in the lives of cancer patients from the efforts of the Dendreon team. Fortunately I bought early. Unfortunately the price has stalled below what I consider an appropriate value which means I've been using an uncomfortable amount of stock to pay my bills.
(I've also collected links to the other discussion boards and my other stocks over on my blog

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