Dendreon Sells Shares To Raise $200M For Provenge Manufacturing, Marketing
Dendreon is striking while the iron is hot. The Seattle biotech company said today it is offering 10.7 million new shares of stock to investors, and has hired Deutsche Bank Securities as the sole manager of the offering. Dendreon didn’t disclose the price of the shares, but with its shares trading at $19.50 a share after the opening bell, this deal will likely raise more than $200 million.
We reported here on Wednesday that this sort of deal was on the way. Dendreon (NASDAQ: DNDN) disclosed in its quarterly filing with the SEC that it had just $91 million in cash and investments at the end of March, and that wasn’t enough to beef up the manufacturing and marketing capabilities it will need to make the most of sipuleucel-T (Provenge), the new drug for prostate cancer that it expects to bring to the U.S. market next year. An urgent push to commercialize the drug is happening now, because the drug showed in a clinical trial it can boost median survival times by 4.1 months for men with terminal prostate cancer, with minimal side effects. The company plans to apply for FDA approval in the fourth quarter of this year.
Dendreon shares shot up 10-fold from February after the news broke about Provenge’s success in the clinical trial, making it possible for the company to sell all these shares on much more favorable terms than before. It will use the proceeds of the offerings not just for manufacturing and marketing, but for IT infrastructure needed to keep track of this customized immune-boosting therapy, and for a distribution network to ship it efficiently. The company is going on a hiring binge to bring in people with needed skills. (The company has 68 job listings at the latest count on its website, growing from a base of 198 workers on March 2.)