Following yesterday's disclosure that Dendreon had fallen short of its revenue targets with its new drug Provenge, and that it was backing away from its previous sales forecasts for $350-$400 M for the year with no replacement guidance, the market dropped its stock price by 60% in after market trading. That's nearly $2.5 B in market cap folks if it translates to today.
The failure in revenue uptake is not being blamed on supply limitations. Rather, Dendreon said that physicians were being conservative in prescribing the $93,000 per patient drug due to concerns about reimbursement. This is despite the fact that Medicare has agreed to reimburse and set up a more streamlined procedure to process payments. The reluctance may be tha the $93,000 price tag hits very quickly -- in a month of treatment -- compared to other expensive cancer drugs that spread costs out more over the course of a year.
"We see this as a shift of the growth curve to the right" said Gold. And apparently a shift of the stock price towards the X-axis. See Xconomy.
Posted by Bruce Lehr Aug 4th 2011.
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Posted by: Stock Market Today | 12/27/2011 at 05:50 AM
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Posted by: Stock News | 09/02/2011 at 01:47 AM
An Open Letter to Dendreon board chairman Brewer from concerned stockholder Brad Loncor in Xconomy that raises questions about Wed debacle.
http://www.xconomy.com/seattle/2011/08/05/an-open-letter-to-dendreons-chairman/
Posted by: bigredbruce | 08/05/2011 at 03:49 PM
A community urologist explains reimbursement fears are real for Provenge in Pharmalot blog
http://www.pharmalot.com/2011/08/provenge-reimbursement-is-a-risk-liang-explains/
Posted by: bigredbruce | 08/05/2011 at 12:14 PM
More on this from the WSJ Health blog that suggests the 67% drop in stock price has to do with real market fears of weak demand for Provenge by oncologists
http://on.wsj.com/n3V40a
Posted by: bigredbruce | 08/04/2011 at 04:58 PM
In the Pipeline weighs in on possible effects of high price of Provenge and third party payer backlash
http://pipeline.corante.com/archives/2011/08/04/dendreon_watch_the_cost_curve_being_bent.php
Posted by: bigredbruce | 08/04/2011 at 04:47 PM
Some chastizing comments from Fierce Biotech
http://www.fiercebiotech.com/story/dendreons-sudden-fall-grace-offers-biotechs-tough-lesson/2011-08-04?utm_medium=rss&utm_source=rss
Posted by: bigredbruce | 08/04/2011 at 04:44 PM