After months of poor sales, Dendreon ($DNDN) terminated its Provenge contract with GlaxoSmithKline ($GSK). The pharma giant would have provided the cancer vaccine's antigen through 2015 as part of the deal.
While the total contract value is unknown, Dendreon's original order last year amounted to $8.3 million, due to arrive in August 2011, according to MedCity News. But "no production runs or product batches had been initiated as of September 1, 2011," Dendreon's SEC filing states, "(and) all previously issued product orders were cancelled."
The contract isn't the only collateral damage. Dendreon is expected to announce layoffs and other cost-cutting actions this week as part of a company restructuring plan. Meantime, doctors' reimbursement worries about the firm's $93,000 treatment continue to contribute to Provenge's sluggish start.
The biotech gave its 60-day notice to GSK Sept. 1 and may still pay the drugmaker $4 million until Oct. 31, the contract's end date.