Medivation Stock Doubles to Lead Prostate Cancer Biotechs

Joel Anderson  |

Shares of biotech company Medivation, Inc. (MDVN) gapped up today over 100 percent on news that trials of its experimental new prostate cancer treatment had showed tremendous success. Along with their partner Astellas Pharmaceuticals (ALPMY), Medivation revealed that its new treatment clearly extended the lives of the men taking the drug.

Excellent Results from Phase III Trial

Medivation's drug candidate MDV3100 showed excellent results in its Phase III clinical study. When placed against a placebo, the drug showed a 37 percent lower risk of death and a 4.8 month median overall survival. The data garnered from the study was so positive that Medivation and Japanese-based Astellas actually opted to end the trial early so that those subjects taking a placebo could take MDV3100 instead. The news of the strong results prompted a furious buying run on Medivations stocks that pushed gains over 130 percent on volume that was over 20 times average. The stock reached a value of 38.84, setting a new 52-week high while approaching the stock's all-time high value of $38.94 a share set on Christmas Eve of 2009.

The good news for Medivation was also bad news for competitor Dendreon Corp. (DNDN), which saw its stock plunge today on news of Medivation's success as well a Q3 earnings report that missed expectations and showed a dreary outlook. Dendreon's stock shed nearly 35 percent of its value after its earnings report showed tepid sales for its own prostate cancer therapy Provenge. Dendreon is suffering from the fact that MDV3100 and Zytiga, the treatment patented by the Johnson & Johnson Company (JNJ), threatened to push Provenge out of the market. The earnings report revealed that the company's problems were worse than expected as it registered a Q3 loss of $1 per share, up 89 percent year over year. Dendreon has already announced that it would have to lose 25 percent of its workforce after lower-than-expected prescription rates for Provenge forced them to scale back their initial sales estimates of as much as $400 million.

More Healthcare Stocks on the Move

Medivation wasn't the only healthcare company celebrating a strong day as several companies posted gains in early trading. Anika Therapeutics, Inc. (ANIK), a leader in products for tissue protection, healing, and repair, based on naturally occurring hyaluronic acid, spiked over 20 percent after they reported a 33 percent increase in Q3 revenue. ABIOMED, Inc. (ABMD) jumped over 20 percent after its Q2 earnings report EPS beat analyst expectations by $0.11 a share, SonoSite, Inc. (SONO) leaped nearly 19 percent on buyout rumors, and Senesco Technologies, Inc. (SNT) announced that they were initiating dosing patients in a  Phase 1b/2a clinical study of its experimental drug SNS01-T and gained over 15 percent.

Also, if misery loves company, Dendreon had at least a couple friends. Hansen Medical, Inc. (HNSN), which designs and manufactures medical robots used in the placement of catheters, missed analyst expectations for EPS in their Q3 earnings report by $0.03 at $0.18 per share. This was paired with the announcement that their new product lines would be delayed until at least next year despite initial predictions. Also losing significant value was DexCom, Inc. (DXCM), down nearly 19 percent, after yesterday's earnings report showed a loss of $0.20 per share, $0.05 worse than many analysts' expectations.

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DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not necessarily represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:

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