New FDA/Government Issues in Dendreon (DNDN)

August 7, 2010 · Filed Under Cancer, dendreon, fda 

Dendreon Corporation (NASDAQ: DNDN) was reported after the close Friday as having received a letter from the FDA asking Dendreon to stop using some promotional materials for its PROVENGE against prostate cancer.

The FDA said in a formal letter that the Dendreon marketing material is “false or misleading” because the materials omit or minimize the risks associated with this in prostate cancer patients.  The letter also said that Dendreon’s material overstate the effectiveness of the treatment against prostate cancer.

The materials, also according to the FDA letter, included a misleading time line expectation.  Another listed complaint was that the Provenge marketing material did not warn that its final sterility test results are not available at the time of infusion.

Time for a reality check, with some caution and caveats.

This is likely to do nothing for the demand for Provenge today nor for the immediate future.  Longer-term, there is a government risk.  The FDA held up Provenge’s approval before finally approving it as a last line of defense for those who have run our of options with advanced metastic prostate cancer. The issue to consider is that this is on top of the recent reimbursement rate attack from the government.

Dendreon closed at $39.05 and it traded down less than 1% at the worst after-hours point with only about 46,000 after-hours shares traded.

As this has popped 50% from the lows of the recent woes, this could be one of the times you see profit taking… assuming those persistent buyout rumors are not just many “hoping for rather than knowing of” a deal.



2 Responses to “New FDA/Government Issues in Dendreon (DNDN)”

  1. Samir Fana on August 9th, 2010 11:59 am

    Dendreon got too greedy with Provenge pricing. The CMS is actively looking for reasons not to reimburse this thing, or to restrict the label indication as much as possible. The name of this NCD might as well be “how substantial is the evidence on efficacy”. Without even getting started on safety–we all know the latest rumors. Think about it: NEJM publication or not, we have not seen ANY new data on Provenge. So, whatever issues the CMS had with Provenge at the start of the NCD still stand today and remain unanswered by data. Rallying support for Provenge is not an economic or scientific game-changer. There has been no new information flow to steer the CMS away from what it really wants to do.
    US & CMS aside, the EMEA will never let this thing through the EU gates without a head-to-head study comparing Provenge with the standard of care treatment (i.e. docetaxel). And forget about NICE in the UK–we’ve all seen what they’re capable of in the last few years.
    So, with these in mind, who would be insane enough to buy out Dendreon at this time? Think about.
    … Actually, one candidate comes to mind: perhaps the CMS itself will buy them out and then shut them down. I’m pretty sure that would save the US treasury a ton in reimbursement money despite the buyout premium.

  2. Jeff Milman on August 10th, 2010 12:16 am

    Dendrion’s value lies in the process: custom cancer antagonists grown in petrie dishes and injected into the body. Even if Provenge doesn’t extend life much at the terminus, what if this process is given on first diagnosis instead of debilitating, expensive and marginally effective chem / rad treatments? No one will die of cancer ever again ! All this speculation may be moot if Stanford University experiments with Genzyme’s FDA-approved Mozobil immunosuppressant proves as effective on humans as on mice. Genzyme is a $200/share stock being sold cheap to Sanofi at $70/share if Mozobil proves to be the cancer cure we all hoped for.

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