Dendreon CEO John Johnson did not face a friendly crowd at yesterday's annual meeting. Shareholders unleashed their frustrations, lamenting lagging sales of the prostate cancer treatment Provenge--and blaming company leadership for last year's overheated optimism.
A lot has changed since then-CEO Mitch Gold forecasted $350 million in 2011 sales. The company was making progress at overcoming reimbursement hurdles, expanding manufacturing and adding to its treatment network, but as the year wore on, Provenge just wasn't catching on the way Dendreon ($DNDN) expected. Plus, Johnson & Johnson's ($JNJ) Zytiga pill was proving to be a formidable competitor.
In August, Gold yanked the forecast and announced plans to lay off a big chunk of its workforce; by February, Gold moved upstairs to the executive chairman's seat, to be replaced by Johnson. Meanwhile, execs had sold off shares before the August announcement; now, the company faces shareholder suits over that alleged insider trading, and the Securities and Exchange Commission is investigating.
"You all ought to be fired for cause," longtime shareholder Charles Heffernan said at yesterday's meeting (as quoted by the Seattle Times); he later told Xconomy that he considered the company's responses at the meeting to be "a bunch of chicken [excrement]". "I wish I was as good at selling stock as some of the executives at the firm," another longtime shareholder, Rob Walker, said.
Johnson downplayed the competitive threat from Zytiga, and said he's working to boost Provenge sales and reduce manufacturing costs. For the first time, the company indicated it would consider teaming up with a partner to market Provenge if it wins European approval as expected next year.