) has been struggling with its sole marketed product, Provenge,
for quite some time now. Provenge, a therapeutic vaccine, was
launched in the U.S. in May 2010, for treating advanced prostate
ACORDA THERAPT (ACOR): Free Stock Analysis
ACTELION LTD (ALIOF): Get Free Report
AMAG PHARMA INC (AMAG): Free Stock Analysis
DENDREON CORP (DNDN): Free Stock Analysis
To read this article on Zacks.com click here.
Earlier this week, Dendreon reported third-quarter 2013 loss
(including stock-based compensation expenses and depreciation) of
38 cents per share, narrower than the Zacks Consensus Estimate of
a loss of 42 cents and the year-ago loss of 45 cents per share.
The narrower loss was attributable to lower operating costs
incurred in the quarter.
Total revenues in the reported quarter declined 12.8% year over
year to $68.0 million. The decrease was primarily due to lower
product sales. Revenues were also short of the Zacks Consensus
Estimate of $77 million.
Quarter in Detail
Dendreon posted yet another disappointing Provenge sales figure
this quarter. Dendreon reported net product revenue of $68.0
million, down 12.8% from the comparable quarter of 2012. Provenge
sales during the reported quarter were also down 7.2% on a
The decline in Provenge sales was due to increased competition in
the prostate cancer market primarily in the form of Zytiga.
In Sep 2013, Provenge was approved in the EU for the treatment of
asymptomatic or minimally symptomatic metastatic (non-visceral)
castrate resistant prostate cancer in adults. Chemotherapy is not
yet clinically indicated for these patients. Meanwhile, Dendreon
is evaluating Provenge in several combination studies.
Dendreon's research & development (R&D) expenses in the
reported quarter were $17.6 million, down 5.7%. Selling, general
& administrative (SG&A) expenses for the third quarter
decreased 17.5% to $56.2 million.
Apart from releasing the third quarter 2013 financial results,
the company threw light on yet another restructuring initiative
to reduce costs further. Dendreon expects to reduce more than
$125 million in cash operating expenses this year. Dendreon
expects to realize net benefits from the restructuring
initiatives from the first quarter of next year. The company also
intends to slow down its cash burn in the coming quarters.
Dendreon now expects 2013 R&D and SG&A expenses to
decline 14% and 23% on a year-over-year basis, respectively.
We are disappointed with Provenge sales in the first nine months
of the year. We still believe that the successful
commercialization of Provenge is crucial for the financial
performance of Dendreon. The company also lacks a decent pipeline
with none of its candidates likely to hit the market in the near
Dendreon carries a Zacks Rank #3 (Hold). Meanwhile, companies
AMAG Pharmaceuticals, Inc.
Acorda Therapeutics, Inc.
) currently look better positioned. While Actelion carries a
Zacks Rank #1 (Strong Buy), AMAG and Acorda carry a Zacks Rank #2