Dendreon's $230M Haul Says It All
The roughly $230 million raised by Dendreon (DNDN) Thursday night was the second largest follow-on stock offering by a biotech company in 2009 -- a year in which money raised by the sector overall is down significantly.
That's a pretty good indication of strong demand from institutional investors for a piece of Dendreon and its prostate cancer vaccine Provenge.
Only Vertex Pharmaceuticals (VRTX) was able to price a larger stock offering this year, raising $320 million in February. After that sits Dendreon, followed by Cadence Pharmaceuticals (CADX) ($86 million), Seattle Genetics (SGEN) ($56 million), Allos Therapeutics (ALTH) ($49 million) and Geron (GERN) ($46 million), according to Burrill & Co., a San Francisco-based life sciences merchant bank.
No one should be surprised that Dendreon chose to sell company stock to raise money. After last week's Provenge data presentation, CEO Mitch Gold was upfront about the company's plans to raise money in two ways -- both through a stock sale and by partnering Provenge's ex-U.S. commercial rights.Gold was more circumspect about the timing of a stock sale, but generally speaking, biotech companies try to raise money when they can -- when the demand for the stock is high -- and not when the money is desperately needed. In this case, Dendreon was able to sell 10.7 million shares with a 1.27 million-share over-allotment in an overnight deal handled by Deutsche Bank Securities. The company hasn't yet announced pricing, but the deal reportedly went off at $19.20 a share. That's at the high end of the range in which the stock was being offered Thursday night and a minuscule 3% discount to Dendreon's closing price of $19.76.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV