Ever since Dendreon's ($DNDN) lackluster Provenge launch, the Washington-based biotech's failures have cast a pall over the troubled cancer vaccine field. And the company's bankruptcy won't help with that.
A $620 million debt pileup propelled the company to Monday file for Chapter 11 bankruptcy protection and strike a deal with note-holders to convert their debt into shares. As part of its bankruptcy strategy, the company plans to sell itself via auction, with qualifying bids beginning at $275 million.
"The company has concluded that even if it was able to successfully realize its current operating projections, it would likely be unable to repay or refinance the 2016 notes when they mature and, as such, the business would not be viable on a standalone basis absent a strategic transaction or restructuring of its debt," it said in an SEC filing.
The first cancer vaccine to win FDA approval, Provenge was heralded as a future blockbuster back in 2010. But a hefty $93,000 price tag, manufacturing hurdles and serious competition from new, more convenient rivals Xtandi and Zytiga helped sink the treatment: Since then, analysts have revised their 2020 annual sales estimates from $4.3 billion to $378 million, Bloomberg notes.
And it's not just Dendreon that's suffered from Provenge's misfortunes. Cancer vaccine makers have faced hefty doses of skepticism at every juncture, with a couple of high-profile flops from GlaxoSmithKline ($GSK) and Merck KGaA bogging the field down further. More than a few companies have rethought their strategies, with some, like Amgen ($AMGN), opting to test their vaccines as part of immunotherapy combos.
But even for those companies that reach the approval finish line, Provenge will be hanging around as a cautionary tale. As experts told Decision Resources Group in a report published this summer, they're "uncertain about the logistics and processes involved in the manufacture of personalized therapeutic vaccines … and are concerned about potential impact on patient management in routine practice."
- read Dendreon's release
- see the 8-K
- get Bloomberg's take
Special Reports: Top 10 Drug Launch Disasters - Provenge | Top 15 Drug Launch Superstars - Zytiga - Xtandi