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Biotech Roundup: Antigenics, Dendreon, Wellcare...


Some stocks in the oncology sector are so unloved, even fabulous data has no effect.


From the AACR/NCI/EORTC conference in San Francisco:

This conference and a sister conference in April are where the biotech "gang" comes to see what's next in cancer therapy. This is a conference by geeks for geeks, and the smartest folks from the most experienced biotech hedge funds are here. This is the first time I've been to this conference, and it is a surprisingly different vibe than the others I attend.

When you heard the trashing Wellcare (WCG) took yesterday, did anyone else flash back to the Microstrategy (MSTR) debacle in 2000 that signalled the end of the bull market in tech stocks?

Some stocks in the oncology sector are so unloved, even fabulous data has no effect. Check out the news story on your Bloomberg for Antigenics (AGEN). 11 of 12 brain cancer patients who had essentially no chance of being alive after six months are pushing nine months of survival after taking an active immunotherapy using AGEN's manufacturing process and gp96 adjuvant. I've not been a big fan of this company or its drug, and these are only Phase I data, but they are very impressive. I had a long chat with the brain surgeon spearheading the trial and I'll have more on this in a few weeks.

Barron's carried a story on some big options trades in Dendreon (DNDN) this week. Someone sold 35,000 Jan $12.50 calls to buy 20,000 Jan $10 calls. Barron's called that a bull spread and interpreted it as the player believes the stock will close in that range in January -- about 60% higher than where it is now. Dendreon will have essentially no news between now and this time in 2008 when interim survival data could be available on its third Provenge trial. The only other possibility for news is an ex-North America partnership, but I'd be surprised if any deal was signed by then. Long-time Dendreon watchers know a partnership was first promised in 2004, so Dendreon investors tend to be, um, circumspect about the whole partnership thing.

Look for these to be hot as this decade closes: JAK, MET, MEK. Nope, not ticker symbols. They are cancer drug targets seeing the biggest buzz here at the meeting.
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