Is The SEC Probing Trading In Dendreon?
3 CommentsBy Ed Silverman // February 8th, 2010 // 8:06 am
Much of the long-running controversy over the Provenge prostate-cancer vaccine, which could be approved by the FDA on May 1, has centered on the viability of the data or a 2007 FDA advisory panel recommendation for approval that was overturned by FDA higher-ups amid dizzying conflict of interest charges (some background here, here and here, here).
The messy episode has prompted patient protests, unusual stock trades, a lawsuit accusing the FDA of illegally withholding info and countercharges from the FDA that conspiracy theorists are wasting the agency’s time. Much of the sparring, though, has centered on patients and the drug-approval process, but another subplot appears to be emerging - the U.S. Securities and Exchange Commission may be probing some of the rollercoaster trading in Dendreon shares during some of the more volatile moments of the past couple of years.
A September report by the SEC’s Office of Inspector General notes a probe was opened into complaints from an investor “alleging that the SEC failed to investigate instances of market manipulation and other misconduct in connection with the review, and eventual nonapproval, of a developmental drug. The investor also has alleged that the SEC failed to investigate a recent bear raid on the stock of the company that developed the drug, causing a severe plunge in the stock price. The OIG has reviewed several hundred pages of documents, including numerous e-mails and attachments provided by the complainant.” The OIG concludes by saying it expects to issue findings in its next reporting period, which would be April (see page 106).
There was, indeed, some volatility. As noted in BusinessWeek, Dendreon shares fell 70 percent in just a few minutes one day last April - the same day that Dendreon was expected to announce Provenge test results, which proved favorable. Interestingly, there was a mysterious message left on a Yahoo Finance message board about a forthcoming bear raid. This chart shows the curious and pronounced drop in the stock price. And according to a source who is familiar with the Dendreon saga and market manipulation, the SEC has been looking at trading in the vaccine maker. Of course, to some, this may be yet another sideshow in the larger debate over whether and how Provenge wins approval. But it may also epitomize the passion and frenzy surrounding the product and its prospects.
Kerry Donahue
In that responsive document (the brief filed by the FDA) they assert that when FDA’s Pazdur destroyed the documents in or around May 2007, which by the way would be evidence of his role in the sabotage of Provenge, that there was not the controversy surrounding Provenge that CareToLive suggests.
Hunh?
Dr. Pazdur apparently did not notice the network news coverage, the protests in Chicago and DC, or the 100 or so articles, the blogs or the congressional inquiries!!
No controversy? Just a mere figment of our imagination?
myPharmalotID
What a disgrace we have in our judicial system and federal government:
1. CTL’s FOIA request for Dr. Pazdur’s papers relating to the non-approval of Provenge is well over a year old, yet has been fought tooth and nail by none other that our very own Department of Justice (who thanks you for your tax money!). The FDA FOIA Office originally claimed that this was a highly complex FOIA request that would take a considerable amount of time to complete. In the end, it turns out, the whole matter was resolved by simply asking the good doctor if he had the documents. Nope, he says, I destroyed anything I had. So everyone signs papers to that effect and CTL is notified that the documents don’t exist. That didn’t even cost a First Class USPS stamp! Complex my (_|_). I guess asking the fox what happened to the chicken is the US government’s way of handling complex matters these days!
2. And then we have the court in Ohio that either did not bother to read CTL’s filing or is too lazy to do anything but parrot back the DOJ’s words and simply reject’s Kerry’s arguments out of hand. Hey, it doesn’t take a genius to figure out that if the papers exist, they easily can found by even an apprentice IT technician on the FDA’s e-mail servers using a simple keyword search. This is NOT rocket science. (Believe me … I have done rocket science!) A search of the FDA’s e-mail server is just about as simple as searching your own Outlook files for an e-mail you’re trying to find!).
3. And what about the missing e-mail from the good Dr. Scher to Dr. Martin that NCI refuses to release (and that HHS said, in a letter on January 29, 2010, that come Hell or high water, it never will release!)? Again, it doesn’t take a genius to figure out what’s in it. Look at the e-mail from Dr. Martin that follows it in the string…the one where she says, and I quote:
“To: Scher, Howard I./Medicine
“Sent: Sat Mar 31 16:15:05 2007
“Subject: RE: with your blessings - will circulate to authors this week [this pertains to a paper they are preparing for publication]
“Glad to hear letter is being drafted. If that division’s [CBER] vote suggests it be considered for approval, I was wondering if it then could go to ODAC [Pazdur's organization], which is more clinically savy (sic), i.e., this is just a step in a process.”
Now, does not the missing e-mail tell Dr. Martin that there may have been a meeting at the FDA on the Friday after the Provenge Advisory Committee meeting (on 3/29/2007) and that he, Dr. Scher, either was asked to write a letter disparaging Provenge (there is anecdotal evidence to this effect) and has decided to write a letter disparaging Provenge? By the way, if you read the transcript of the AC, you will find that despite a 17-0 vote on the drug being safe, there is NO mention of Dr. Scher’s vote in the transcript. And would it surprise you to know that one of the points made in the Dr. Scher’s letter (the one that Dr. Martin edited (v.3 was found on her government computer and obtained by CTL under FOIA)) was the Provenge was not safe.
By the way, do you get the hint, here, that CBER is not held in high regard. That must make them feel great. Never mind that CDER doesn’t have a clue as to how a treatment like Provenge works. They are all about chemo!
4. One thing the FDA still has yet to explain is why the second question on efficacy at the Provenge AC was not worded correctly when it was first presented to the Advisory Committee. The first wording of the question was not consistent with federal law, you will recall, and it had to be reworded on the fly, so to speak, before the 13-4 vote was tendered. People still are kvetching about his, complaining that if the question had not been reworded, the AC would not have recommended approval. Well, to those whose panties still are all wadded up over that, get over it…the question as first stated was incorrectely worded, plain and simply. (Did someone deliberately play with it?) Look at what the federal law prescribes!
So, you be the judge. Who’s hiding what? CTL’s cards are on the table, face up? It’s the government … HHS, FDA, NCI, and their handmaiden, the DOJ, that’s playing with a crooked deck. And you don’t think that corruption abounds in this case?
Give me a break!
David
Ed, thanks for your continued attention to the story.
I would add whenever people bring up an issue it is usually only part of the story. As it is with anything having to do with Dendreon stock which, for many of us, is not the issue. It was and is Provenge approval.
But THAT story requires attention to stock issues as well as others. Perhaps especially the stock issues as that may go to the heart of the FDA decision May 2007.
The snap shot:
Late May 2007 Novacea/Schering-Plough deal, $500M to license Asentar (direct competition to Provenge) although still in Phase III trial. Declared a failure later that year by Novacea.
3 weeks prior the FDA announced the postponement of Provenge approval. With approval there’d have been NO deal for Novacea.
Why did the FDA postpone approval when 6 weeks prior the Advisory Committee voted 17-0 Provenge is safe, 13-4 it is effective?
During April Dr. Scher wrote a letter to the FDA (soon leaked) lobbying against Provenge approval. Other letters, written by people with COI’s, also appeared. His letter contained several distortions/false statements about the issues. Moreover, a/some drafts were apparently written on a computer at NCI. Why? and Why? and Why?
Dr. Scher had very serious conflicts of interest which were NOT listed in his waiver request letter: the fact he was the principle investigator for Novacea in the then current Asentar trial and the fact he was an employee of a venture capital firm, ProQuest, which was heavily invested in Novacea.
Moreover, 2003 Dr. Scher publicly disclosed he was invested in the venture capital firm, ProQuest. Since he was still employeed in 2007 was he still invested in the firm, hence invested in Novacea?
On Monday April 1, 2007, the first stock market trading day after the A.C. meeting of March 29, 2007, a massive short-selling of Dendreon stock occurred which lasted for a few days. Much of which apparently was naked-short-selling. This, in the face of the very positive A.C. vote ‘recommending’ Provenge approval, and, no public discussion of the issues at that point. So Why?
After the A.C. vote that Friday, March 29, 2007 Dr. Scher exchanged several emails with a Dr. Alison Martin of the NCI over the weekend. These included a discussion of an organized effort to write a letter(s) to the FDA lobbying against Provenge approval which Dr. Martin shared with at least one other NCI employee.
At least one draft of Dr. Scher’s letter was apparently written on Dr. Martin’s NCI computer.
Finally, Provenge had received Fast Track status in 2005. It substantially met the FDA criteria for fast track-accelerated approval, and, the FDA was already familiar with the Provenge trials and data issues that the A.C. committee studied and debated March 29, 2007, arriving at a recommendation for approval.
So what happened?