Dendreon slashes more jobs
pharmafile | November 13, 2013 | News story | Manufacturing and Production, Research and Development, Sales and Marketing | Cancer, Dendreon, Provenge, cuts
Another 150 jobs are to go at Dendreon Corporation as the company seeks to cut $125 million per year in costs out of its operation.
The main problem is familiar: sluggish sales of its cancer vaccine Provenge, which is indicated to treat metastatic, castration-resistant prostate cancer (mCRPC) in men who have not received chemotherapy.
Provenge (sipuleucel-T) was approved by the FDA in April 2010 but its US breakthrough did not open the floodgates: last year its slow uptake was in large part the reason for the Seattle-based biotech slashing 600 jobs and closing its manufacturing facility in New Jersey.
Relatively high cost and an unusual mechanism of action – plus competition from rivals such as Johnson & Johnson’s Zytiga and Medivation Inc’s Xtandi – have been advanced as reasons for Provenge’s failure to gain the foothold in the market its manufacturer expected.
The drug is manufactured by Dendreon at its two surviving factories in Atlanta and Seal Beach, California. Last year Provenge had revenues of $325 million.
Following the latest restructuring, the company will have approximately 820 employees, down from more than 2,000 at its peak – but Reuters quotes Wedbush Securities analyst David Nierengarten as saying that the move is ‘too little and too late’.
However, there is no doubt that the drug works and in September there was good news for the company when Provenge was given the green light in Europe.
The novel therapy harnesses a patient’s own immune system to fight against their cancer and has been shown to improve overall survival compared with placebo.
In the Phase III IMPACT study, median survival was 4.1 months longer for patients taking Provenge compared to those who received placebo, with similar effects found in the two other studies.
Reporting a third quarter loss of $67.2 million (compared with a $154.9 million loss in Q3 2012), chief executive John Johnson insisted: “We have seen a strengthening of our business during the past two months.”
He continued: “Accelerating the path to profitability has been a top priority for Dendreon. Consistent with that goal, we are restructuring the company and implementing additional cost reductions to enable Dendreon to succeed as a leaner, more nimble biotechnology company focussed in immuno-oncology.”
Dendreon expects to see the benefits of its cost-cutting measures as early as the first quarter of 2014, Johnson concluded.
Adam Hill
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