精华 苦辣酸甜难书尽，成败得失笑谈中

SEATTLE, Jan. 14, 2011 — Dendreon Corporation (Nasdaq: DNDN) today announced the pricing of a public offering of $540 million aggregate principal amount of 2.875% convertible senior notes due January 15, 2016 (the “Notes”) in an offering registered under the Securities Act of 1933, as amended (the “Securities Act”), which was upsized from its previously announced $500 million offering. The Notes will be convertible into cash, shares of Dendreon’s common stock (the “Common Stock”) or a combination of cash and shares of Common Stock, at Dendreon’s election.

The conversion rate will be adjusted upon the occurrence of certain events, including stock dividends or share splits, the issuance of rights, options or warrants, spin-offs or other distributed property, cash dividends or distributions, or tender offers or exchange offers.


DNDN probably is worth another look. The above is the from 8-K and 10-Q on the convertibles. Here is a quick summary:

1. DNDN has $520 M cash plus investment with $500 M convertible debt due 2016. Conversion at is at $51 per share.
2. As indicated by the above two abstracts, DNDN can settle the debt with shares ! And there is no strong reason for ratio adjustment. This means 10M shares are needed and is around 7% dilution based on current closing price.
3. This means DNDN's market cap is essentially at $500 M.

DNDN's quarterly loss is $140M and it can bleed for another 4 quarters.

So, the question is if DNDN could be a target for purchase. The other question is what is DNDN's legal risks of its products ...

Any thoughts ?
 
Thanks for the update. The option premium is very high and there is probably an angle for play. Your comments are appreciated:

1. The company has $3.25 cash per share.
2. If PUCHA is negative and the company still submits for FDA approval, the stock price may still have support till March.

Therefore, the negative news probably will send the stock to $3.00 but it could float up again in the new year.

What do you think ?
 
I read the overall market is $3 B but not sure about the dialysis market. The market cap of the company is less than $100 M and thus there are probably rooms for grow if the drug is approved.

Plus, it is a JV with Takeda. The issue is IF it is approved ...
 
Thanks for your response. I don't have any position in the company and was just wondering.

I think your highlight of safety is right on the point ... Any good bio plays you have been following and worth playing ?

ITMN may become interesting again next year. I think its retest shall be available sometime in 2012. Are you still following it ? Its move in either direction can be dramatic.
 
The market size seems to be small...

Are you following ITMN ? I think this is a bio play for next year ...
 
加京游子 说:
Selected sub-sectors have been on fire late last year (Hep. C) or early this year (oncology). Many have made a double/triple/5 baggers/10 baggers in the matter of days. Owing to a string of devastating losses, I missed most of these actions right in front of my eyes, sigh. The sector seems to be back in play, and the year is to make or break personally.

1) Flat on MDVN and DNDN: As posted earlier, I sold the tiny number of MDVN shares after the interim peek stop for afficacy, never looking back until last week when the safety data was released. Trying to short the top, I bought some puts when it dropped from 70 to 68. The damned stock kept going up and I got out, losing 80% in two days. Bought some DNDN when it stabilized at 6.5. Sold out when the new CEO was installed and missed the big run a few days ago. I simply cannot hold the stock when I can't stand the CEO. This Johnson dude ran SVNT from 25 to 2 in a few months and is DNDN's CEO now. I thought I did not like Gold but he was absolutely fine compared to this Johnson dude, my final trigger for kissing DNDN good-bye. Best of lucks to anyone and everyone holding DNDN!

2) Selected names to watch/play: a) ONTY --- an immediate calalyst for a big move either way, the second interim peek in Q1. This thing can open at double or half of today's price one of these days. Betting on no results prior to Feb. 17, I sold some Feb. puts last month and they are deep in the money as of today, one more week for these to expire.
点击展开...


Nice to see you are back, Jia. Hope you can post more often here, especially before any significant events.

You are no doubt the pioneer on this board on bio issues. This is still a very good area for speculation.

I think you played VVUS and ARNA a few years ago. Now, this pair is back again. I think there is a disconnection between valuation of the two companies with VVUS at $1 B and ARNA at $300 M.

Buying VVUS put (say at $7) and ARNA calls might make sense. However, this is a PUDA meeting not FDA meeting. Therefore, the timing might be questionable... PUDA may be soft on VVUS...

What is the event with ONTY ? Its option premium is loaded and definitely will explode in either direction ....
 
加京游子 说:
VVUS going to the FDA first is a good thing for ARNA. Good results? Positive sector effects; bad results? Leaving ARNA the only game in town with an FDA catalyst expected in Q1/Q2 and final decision in July.

The first go round was a devastation as the rat tumour issue was a total surprise (FDA corruption another nail in the coffin). With the DM data and addressing the rat tumour issue by the company and its partner, I feel confident about this go round. Valauation is also a consideration.

Why did I built my position the way I did, a weird combination indeed? I wanted some leverage and there is only about 10% time value in July 1 calls. Selling the puts is to reduce cost base or average down in case of a big drop.

I will write covered calls when the opportunities present themselves.
点击展开...


ONTY is interesting and now with a successful chairman is even more interesting. Not sure what to look for in the company's history. But a legendary Chairman is always worth studying...

I can see you have spent serious time on bio and hope we can make some killings in this area.

I don't quite understand your ARNA positioning. I thought there would be three scenarios and would appreciate your insights:

1. VVUS got strong recommendation.
2. VVUS got rejection.
3. VVUS got weak recommendation.

With out of money cheap call on ARNA and equivalent put on VVUS. One probably can build a sensible bet on 1 and 2. Situation 3 may wipe this hedged position but still with subsequent events to play on.

If VVUS is down, ARNA will get a hit but it is probably good time to build July calls. Black swan events with cheap cost are probably worth looking at ... especially with fund from VVUS failure.

IF ONTY has positive results, what valuation do you expect it reach ? $1 B based on past DNDN experience ?
 
Based on Yahoo, the short interest is very high at 40%.

There is no tricky angle to be found in ONTY. It is a straight bet on either direction, say by using May option.

My feeling is that any bet on the long side probably makes sense. Downward protection probably is not useful here since ONTY has been quite resilient over its long history.

Reason for betting on long is probably due to Merck's involvement. If it hits, it could be huge - even due to such high short interest ...
 
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