Washington Editor

If therapeutic cancer vaccine developers were in need of a shot in the arm, they got it last week.

Several firms working in the space saw their stock values make measurable gains on Friday, riding the coattails of Dendreon Corp., which Thursday received a positive endorsement from an FDA advisory committee reviewing Provenge (sipuleucel T). No other immunotherapy product for cancer has advanced this far down the regulatory road. As a result, the Seattle company's shares (NASDAQ:DNDN) went through the roof Friday, gaining a whopping 148 percent, or $7.71, to close at $12.93. The stock, in which there was a widely acknowledged short position, was halted Thursday throughout the advisory meeting.

After the vote on the active cellular immunotherapy, which has been developed for advanced prostate cancer, Dendreon CEO Mitchell Gold predicted the positive outcome for other companies. That feeling was echoed by Paul Latta, an analyst with McAdams Wright Ragen Inc. in Seattle, who said the committee vote on top of the its entire deliberations added a solid sense of legitimacy to the immunotherapy field as a whole.

"There was an acknowledgment of immunotherapy's potential in comments made by panel members during the meeting," he told BioWorld Today, later adding that "there's no question that what the panel said positively impacted all of the immunotherapy stocks."

In particular, he pointed to the benefit for Cell Genesys Inc., Friday's top value gainer beyond Dendreon. Its prostate cancer immunotherapy, called GVAX, is staged just behind Provenge. The product, which is in Phase III testing for prostate cancer, also has been evaluated in multiple types of leukemia. The South San Francisco company's shares (NASDAQ:CEGE) began creeping up during the meeting and even more so in after hours trading, and shot up 20 percent to $4.20 by Friday's market close.

Similarly, San Diego-based Favrille Inc., which is working on an active immunotherapy product known as FavId for non-Hodgkin's lymphoma, saw its stock (NASDAQ:FVRL) climb 17 percent to $3.07. Genitope Corp., a Redwood City, Calif.-based company developing MyVAX in non-Hodgkin's lymphoma and leukemia, gained 12 percent in its share value (NASDAQ:GTOP) to $4.15.

Still, these reactions could reflect a measure of over enthusiasm to some degree. In fact, there may be some over exuberance for Provenge, because FDA approval is not a slam dunk.

Even though the agency typically follows the advice of its advisory panels, there was not definitive certainty in the committee's positive vote. The vast majority of advisors voted favorably only after FDA reviewers changed their question from whether the data underlying Dendreon's biologics license application establishes the product's efficacy to whether it provides substantial evidence of its efficacy.

As Joel Sendek, an analyst with Lazard Freres & Co. LLC in New York wrote in a research note, the company "snatched the panel victory from jaws of defeat" after the FDA "softened" the efficacy hurdle mid-vote. But in spite of that endorsement, he said he continues to believe that the post hoc analysis of two small trials supporting the company's regulatory filing "will be insufficient for approval." Instead, Sendek said he expects approval in 2009, contingent upon positive interim survival data expected in the middle of next year from a large Phase III trial called IMPACT, which has nearly completed enrollment.

That could benefit Cell Genesys, which could leapfrog GVAX past Provenge in the race to market.

The Dendreon findings in question include a 4.5-month survival benefit for Provenge-treated patients compared to those on placebo (p=0.012), as well as a 23 percent difference in three-year survival rates favoring Provenge over placebo (p=0.0046), in a 127-patient trial called D9901. Other supporting data came from a smaller study labeled D9902A.

The FDA is scheduled to complete its review by May 15, and while there remains uncertainty as to whether the agency will approve Provenge by then or issue an approvable letter contingent on the IMPACT data, as Sendek suggested, Latta said the committee certainly removed an worries about a rejection.

As a result, he said Dendreon's stock is fairly valued in the wake of the committee vote, based on multiple variables priced into a pre-earnings biotech company. In addition, Latta predicted $500 million in eventual annual sales for Provenge, a peak that would take three years to reach after approval, though he admitted uncertainty as when that might happen.