Why Dendreon Corporation Shares Soared

Dendreon shares spike higher after presenting positive data on Provenge at the American Urological Association's annual meeting. Find out what investors should really be paying attention to instead.

May 20, 2014 at 2:30PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Dendreon (NASDAQ:DNDN), a biotech company that utilizes immunotherapeutic vaccines to treat cancer, soared as much as 14% after reporting additional data on Provenge, its advanced prostate cancer vaccine, at the American Urological Association's annual meeting.

So what: According to Dendreon's press release, while no specific figures were mention, it did note that data collected from its ProACT and IMPACT studies suggest that "Provenge elicits an immune response associated with an overall survival benefit." Dendreon's presentation also includes data from its PROCEED trial which suggests similar treatment patterns for urologists and oncologists for Provenge patients with metastatic castration-resistant prostate cancer. As chief medical officer Andrew Sandler, M.D., noted, "The elevated immune response against prostate-specific antigen in the ProACT and IMPACT studies is correlated with overall survival, and may point to a useful biomarker of treatment benefit."

Now what: The data surrounding Provenge has never been much of a question mark. In essence, we knew that it provided a marked treatment benefit over the placebo in studies. The problem has been Dendreon's inability to capitalize on its product, allowing competitors to easily gain the upper hand within the space. Whether it's Dendreon's lack of a marketing partner, its inexperienced sales force, or the fact that Provenge's $93,000 price tag scares physicians and patients away, or a combination of all three for that matter, the point is that Dendreon's inability to turn a profit could put its long-term survival in question. Dendreon does have additional clinical research under way, but following two restructurings which have included hefty job cuts it doesn't look like the company is still anywhere near profitability on Provenge alone. Until we see Dendreon make significant progress with improving Provenge sales I'd strong suggest keeping your distance.

Dendreon may have soared today, but it'll likely take a backseat to this top stock over the long run
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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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