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Dendreon: New Weapons against Tumors


What's so hot about Dendreon (DNDN), which leaped from 3 last year to 9.25 on Sept. 24? The little-known biotech develops immunologically based cancer remedies, and its lead product, Provenge, is aimed at prostate cancer. Mark Monane of investment bank Needham, who rates the stock a strong buy, says Dendreon will soon name a big drugmaker as marketing partner. (Needham has done banking for Dendreon.) Also this year, Dendreon will start Phase 2 trials, which gauge safety and efficacy, for a treatment for breast, colorectal, and ovarian cancer. Monane says Provenge's early trials show a "significant positive survival effect" on prostate patients. He says Food & Drug Administration fast-track status and a "special protocol," which lets Phase 3 results (human testing) be the basis for an application, almost assure Provenge's approval by late 2004. It could be on the market in 2005. Monane sees Dendreon in the black in 2006, with earnings of 4 cents a share on sales of $100 million. Thereafter, sales could hit $140 million, with earnings of 76 cents. George Farmer of Fortis Securities also rates Dendreon a strong buy. He says initial Phase 3 results show Provenge has an "excellent chance" as a treatment for prostate cancer.

Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them. By Gene G. Marcial


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