Reader Will S. asks about Genitope ( GTOP). "Another company with spotty fundamentals, but possibly a breakout cancer vaccine," he writes, adding that "I think it's the next Dendreon ( DNDN)." I actually wrote this mailbag a week in advance because I needed a few days off this week, so Will's letter is a bit old. Given the Dendreon news Wednesday, I'm sure he doesn't want Genitope to be the next Dendreon anymore! But it may not have any choice. I have serious doubts about Genitope and its cancer vaccine, known as MyVax, that is currently involved in a phase III trial of follicular non-Hodgkin's lymphoma patients. This MyVax study essentially (not directly) pits the vaccine against Genentech's Rituxan, which is a monster drug in non-Hodgkin's lymphoma. That always seemed ridiculous to me, and I never had any faith in a positive outcome. But I really want to detour a bit because any discussion of Genitope has to touch on Jonathan Aschoff, the biotech analyst at Brean Murray, Carret & Co. These days, Aschoff is best known -- some would say notorious -- for his bearish stance on Dendreon. He hates Provenge, thinks the product doesn't work and won't ever receive FDA approval. He has a sell rating on Dendreon and a flinty $1.50 price target. Well, Aschoff was right about Provenge this week. Needless to say, Aschoff is not exactly admired by the Dendreon faithful! (He may actually get more hate mail than I do.)
Stan C. asks about Immunogen ( IMGN - Get Report), his favorite biotech stock. "It is a cancer stock that really hasn't participated in the cancer investment craze. It has an interesting drug platform and numerous large partners. A buyout seems inevitable if they can get near an approval. What do you think?"
"I have a question regarding Nymox Pharmaceutical ( NYMX - Get Report)," writes Tim W. "I was wondering what your thoughts were on their NX-1207 drug for BPH. Nymox has been on the move in the past few months and word has it that NX-1207 could be a big drug for them." I looked into Nymox and didn't like what I saw. If you want a small-cap biotech company with a pipeline drug to treat BPH, or benign prostatic hyperplasia (an enlarged prostate), I definitely prefer Spectrum Pharmaceuticals ( SPPI - Get Report). Another choice would be Aeterna Zentaris ( AEZS - Get Report).
Juan is not a fan, apparently. He writes, "I think you are out of your mind. Why do you approach everything so negatively? Some of us with some of these illnesses care to hear something positive and for sure we don't get it from you." Negative? Me? I prefer to think of myself as appropriately skeptical. But yes, sometimes that requires a certain amount of negativity, as in writing that Drug X doesn't work. Wishful thinking or positive thoughts won't change that. That's not to say I can't sympathize with those who suffer with disease. I absolutely do. But I write about biotech stocks, and we all know that requires a healthy dose of realism. Too many drugs -- and drug companies -- go bust for me to be any other way. Please note that due to factors including low market capitalization and/or insufficient public float, we consider Genitope, Immunogen, Nymox Pharmaceutical, Spectrum Pharmaceutical and Aeterna Zentaris to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.