Struggling Dendreon Corporation Plunges After Warning Investors Of Debt Woes

Struggling Dendreon Corporation Plunges After Warning Investors Of Debt Woes

August 13, 2014
By Mark Terry, BioSpace.com Breaking News Staff

Seattle-based biotech company Dendreon announced there was “significant risk” it would not be able to pay off its $620 million debt. As a result of that statement, stock shares dropped 20% to $1.67 in premarket trade Tuesday. It reported a quarterly loss of $15.3 million, about 10 cents per share, and revenues of $82 million. The debt was in the form of convertible notes due in January 2016.

Dendreon announced this in a 10-K filing with the SEC. It cited, “There is significant risk that … we will not be able to repay or refinance the 2016 Notes. Accordingly, we are currently considering alternatives to the repayment of the 2016 notes in cash, including alternatives that could result in leaving our current stockholders with little or no financial ownership of Dendreon.” The statement doesn’t specifically mention Chapter 11 bankruptcy protection, although it would seem to suggest it.

The company’s primary product is Provenge® (sipuleucel-T), a treatment for asymptomatic or minimally symptomatic metastatic castrate resistant prostate cancer. The drug recently received E.U. approval, which made some analysts predict positive things for the company. However, according to some sources, Dendreon has been unable to find a partner for European distribution, probably related to reimbursement issues.

Provenge is the only FDA approved immunotherapy for advanced prostate cancer. Designed to reprogram the body’s immune cells to attack prostate cancer cells, the therapy requires white blood cells be removed from the patient, mixed with components of the vaccine, and delivered back to the patient as an infusion. Competing products are Astellas and Medivation Inc.’s Xtandi® and Johnson & Johnson’s Zytiga.®

W. Thomas Amick, 71, recently came out of retirement to replace former Dendreon president and CEO John H. Johnson. Amick was noted in his long career for building Johnston & Johnson’s oncology division, as well as leading a Carolina biotech company.