This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Dendreon Earnings: Provenge Whiffs Badly

Updated with stock price.

SEATTLE (TheStreet) -- Dendreon (DNDN) shares fell sharply Wednesday night after the company reported weaker-than-expected Provenge sales of $49.6 million in the second quarter and withdrew revenue guidance for the remainder of the year due to reimbursement issues.

Dendreon shares are down $21.89, or 61%, to $13.95 in after-hours trading. The stock closed the regular session at $35.84.

Provenge sales in the quarter totaled $49.6 million included a nearly $2 million reserve for chargebacks and rebates, but still fell far below Wall Street's expectations that ranged from $55 million to $60 million.

"We believe the market potential for Provenge is substantial, and the primary issue affecting the dynamics of our launch is the reimbursement knowledge around Provenge," said Dendreon CEO Mitch Gold, in a statement.

As a result, Dendreon withdrew its previous guidance calling for 2011 Provenge sales in the range of $350 million to $400 million and now expects "modest" quarter over quarter revenue growth for the remainder of this year.

To cope with lower Provenge sales, Dendreon will cut costs, including firing an undisclosed number of employees, the company said.

Wall Street has paid close attention to Dendreon's commercial launch of Provenge since the first-of-its-kind prostate cancer cancer immunotherapy received FDA approval last year. But Provenge's performance is receiving even more attention today from investors wanting to see demand for Provenge take off now that Dendreon's manufacturing supply constraints are lifting.

At the end of June, FDA approved a second Provenge manufacturing facility. At the same time, the government agency overseeing Medicare announced a favorable coverage decision for the drug and granted Dendreon a temporary code to speed reimbursement payments to doctors. The latter is particularly important given Provenge's $93,000 price tag.

But what can only be described as a shocking turn of events, Dendreon confessed Wednesday that reimbursement concerns and issues are dragging on Provenge sales.

A third Provenge manufacturing facility is under construction with FDA approval expected on August 28.

Dendreon narrowed its second quarter net loss to $114.6 million, or 79 cents a share from a net loss of $142.6 million, or $1.04 a share in the June 2010 quarter.

Looking further ahead, Provenge could see increased competition from other companies developing drugs on their own, including Johnson & Johnson (JNJ), Medivation (MDVN) and Exelixis (EXEL).

--Written by Adam Feuerstein in Boston.



>To contact the writer of this article, click here: Adam Feuerstein.

>To follow the writer on Twitter, go to http://twitter.com/adamfeuerstein.

>To submit a news tip, send an email to: tips@thestreet.com.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,067.56 -30.89 -0.18%
S&P 500 2,002.28 -1.09 -0.05%
NASDAQ 4,598.1880 +17.9170 0.39%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs