Dendreon to lay off 600 amid weak Provenge sales
SEATTLE — Biotech drugmaker Dendreon Corp. said Monday that it will cut about 600 jobs following disappointing sales of its expensive prostate cancer drug Provenge.
The company also will close its Morris Plains, NJ, manufacturing facility and reorganize administrative work as part of the plan to save the company $150 million annually. The cuts will affect full-time and part-time staff. They will take effect over the next year.
Dendreon said two remaining manufacturing sites in Union City, Ga., and Seal Beach, Calif., should be able to meet demand for Provenge production.
Provenge won U.S. approval in April 2010 and was the first drug designed to use the body's own immune system to fight cancer. Regulators approved the drug for prostate cancer that has not responded to other treatments. Analysts once expected sales to reach $1 billion per year, but sales have not matched those expectations. Analysts have blamed the drug's time-consuming production process, which takes several weeks, not to mention its $93,000 price tag.
"This restructuring sets a new course forward for Dendreon, accelerating our path to profitability and future growth," said CEO John H. Johnson.
The announcement came as the company reported second quarter earnings that missed Wall Street's forecast.