dendreon halted before earnings

For anyone interested. When I held Dendreon they were talking about $30,000 per treatment, but now $93,000, wow. $30,000 compared with three treatments of the standard of care at the time, the chemo Taxotere. Taxotare was approved on a 2 month survival advantage with possible terrible side effects and no one complained about the cost. Provenge beat that with virtually no side effects, but I think DNDN CEO Mitch Gold has pushed it too far IMHO with the $93,000. After hours trading means little with no full exposure to market forces. We will see tomorrow. 62% fall looks way overdone. Maybe fast money to be made there tomorrow for the brave. pre market trading will probably be fast and furious. A lot of big funds own large chunks of DNDN lets see if they defend it tomorrow. It was never boring owning Dendreon.
One of the posters on the investorvillage board suggested they should have seen it coming when Urdal resigned at the end of last year. Urdal was the chief scientific officer for DNDN and the one who stood tall above the others right through 10 years. When Gold and other board members were selling on spikes, Urdal didnt sell a share and that meant a lot to me.
Maybe they have a managment problem now.

[Dendreon Says Reimbursement Woes Hurt Drug Growth; Last update: 8/3/2011 6:44:54 PM DJ News


2nd UPDATE: Dendreon Says Reimbursement Woes Hurt Drug Growth

Last update: 8/3/2011 6:44:54 PM
--Dendreon withdraws 2011 revenue projection on more-gradual drug launch
--Company plans to cut costs, jobs on the new expected sales trajectory
--Reimbursement hurdles for physicians are discouraging use of drug
(Adds stock reaction in paragraph two.)

By Thomas Gryta
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Dendreon Corp. (DNDN) said sales of its controversial prostate cancer drug Provenge are growing slower than expected because doctors aren't comfortable with the complex task of getting reimbursed for the expensive treatment.

As a result, the Seattle drug maker withdrew its sales expectations for the year and announced plans to cut jobs. Shares of Dendreon fell 62% to $13.66 in after-hours trading Thursday.

Provenge, approved in April 2010, uses a patient's own cells to stimulate the body's immune system to fight prostate cancer. The treatment costs $93,000 for a standard course, and delayed reimbursement can cause cash-flow management issues at physician practices.

Chief Executive Mitchell Gold said Wednesday that the launch of the drug will have a "more gradual trajectory" than previously expected because of "reimbursement knowledge" related to the drug. That means that the process of getting reimbursed is difficult enough for doctors that it is discouraging use of the treatment.

Until now, the company had been working to increase its manufacturing capacity in order to meet U.S. patient demand. As recently as May, Dendreon projected full-year revenue of $350 million to $400 million, but now sees only "modest" sequential quarterly growth above its second-quarter revenue of $49.6 million.

Several analysts expressed shock at the company's revamped projections and noted that revenue could now come in below $200 million for the year, well below the current average estimate of $370.8 million.

The company didn't see the problems until now, Gold said Wednesday, because initial manufacturing constraints didn't allow the company to realize fully the reimbursement problems until more supply was available.

On a call, Gold said pressures also emerged because the drug initially was available at large academic medical centers that weren't as sensitive to reimbursement issues. But as capacity increased, the drug began to be used by community physicians at smaller practices, where there is more sensitivity to the reimbursement issues.
Gold defended the price of Dendreon on the call but said the short period of time in which the drug is administered--it is given in three infusions over a month--means that physicians must lay out more cash for Provenge than other cancer drugs used over longer periods of time.

Dendreon still expects Provenge's use will increase over time, citing the recent Medicare decision to cover the drug and the issuance of an electronic code that will make it simpler and faster for physicians to get paid for using the drug on Medicare patients.
The company, however, said it doesn't have clarity on when physicians will begin to be more confident in the "clear and consistent" reimbursement practices. As a result, Dendreon plans to cut costs, including with job cuts, to be consistent with its "near-term manufacturing requirements."

Provenge, the first immunotherapy for prostate cancer to gain U.S. regulatory approval, has been shown to extend patient survival by a median of about four months. Some health-policy experts, though, have questioned paying so much for a drug that may lengthen life for a relatively short time.

For the three months ended June 30, the company reported a loss of $114.6 million, or 79 cents a share, compared to a loss of $142.6 million, or $1.04 a share last year. Excluding items, the company reported a loss of 57 cents a share, which was narrower than Wall Street expectations of 71 cents a share, according to Thomson Reuters.
Revenue rose to $49.6 million from $2.8 million a year ago, falling short of analyst expectations of $57.7 million.
At the end of June, Dendreon had $673.9 million in cash, cash equivalents and investments, compared to $277.3 million at the end of 2010.

-By Thomas Gryta, Dow Jones Newswires; 212-416-2169; [email protected]
(END) Dow Jones Newswires
August 03, 2011 18:44 ET (22:44 GMT)]


Please delete this post if deemed unsuitable for sensitive PRR invesrors:-) This is another unforseen hurdle that DNDN will have to work out long before PRR faces it. The small docs dont like the reimbursment arrangments for the $93,000 treatment.