Dendreon Surprises With $82M in Fourth Quarter Sales, Stock Booms

Xconomy Seattle — 

[Update: 6:58 am PT] Dendreon greatly disappointed investors in 2011, but it ended up closing the year out on a stronger note than expected.

The Seattle-based biotech company (NASDAQ: DNDN) said today it generated $82 million in fourth quarter gross product revenues for sipuleucel-T (Provenge), its immune-boosting therapy for prostate cancer. The company hasn’t yet disclosed its net revenue, which subtracts rebates and chargebacks, although that number has been close to gross revenue in past quarters. Today’s announcement isn’t a fully audited financial statement, but Dendreon said it ended up generating $228 million in gross product sales for Provenge during 2011.

That performance surprised investors, who were only told to expect “modest quarter over quarter” growth from Dendreon, which reported $65.8 million in gross revenues in the third quarter. Shares of the company shot up $1.98, or 26 percent, to $9.58 shortly after trading opened this morning.

[Updated comment] Analyst David Miller of Biotech Stock Research, a longtime Dendreon bull, said on Twitter that he was only expecting $75 million in fourth-quarter sales from the company.

Still, the overall year is one that most Dendreon followers would like to forget. The $228 million in product revenue is far short of the $350 million to $400 million sales forecast that Dendreon put in front of investors at this time a year ago, and which helped drive its market valuation beyond $5 billion during the spring and summer of 2011. The company lost most of that value, more than 60 percent in one day, when it said in August that it would fall short of its forecast, citing concerns among physicians about whether they’d get full and prompt reimbursement for a drug that costs $93,000 per patient. The stumble caused Dendreon to lay off 500 workers in September.

Dendreon didn’t offer any specific guidance to investors in today’s statement about what to expect for 2012, other than commentary about how things are improving.

“Given our results for the past two quarters, physician and patient interest in Provenge clearly continues to grow. We believe that the improved reimbursement landscape, along with our improved sales execution and physician education initiatives, are contributing to the increased use of Provenge in the community urology and oncology settings,” said Mitch Gold, Dendreon’s CEO, in a statement. “We had a strong fourth quarter that exceeded our expectations. As we look to 2012, we expect modest quarter-over-quarter growth while we focus on bringing additional clinics on board and converting them into steady prescribers.”