Dendreon Will Build Manufacturing Plant in Georgia

8/10/09

Dendreon (NASDAQ: DNDN), the Seattle-based developer of an immune-boosting drug for prostate cancer, announced today that it has leased property in Atlanta to build a second manufacturing plant for the drug. Rumors about the deal surfaced last month, but Dendreon would not comment before the official announcement. The factory will actually be built in Union City, GA, just southwest of Atlanta, and cover 160,000 square-feet of land. Financial details were not released, but the plant may cost an estimated $80 million and create around 300 jobs for people in the area, according to a report last month in the Atlanta Business Chronicle.

Dendreon’s first factory is in Morris Plains, NJ, but the company expects that extra manufacturing capacity for the drug, sipuleucel-T (Provenge), will be necessary. Concerns over manufacturing limitations have previously been an issue with Dendreon after the clinical trials for the treatment turned out so well. The issue is that sipuleucel-T is not just a pill but a complex treatment. It requires blood to be taken from a patient and processed at a clinic three times a month. It’s extremely important therefore to keep the supply chain uninterrupted.

The FDA is expected to approve Dendreon’s treatment by early next year, but demand is expected to easily outstrip the production capacity of the New Jersey factory. And since most of the estimated 100,000 American candidates for sipuleucel-T live in the eastern corridor of the United States, placing the second plant in Georgia makes a lot of sense.

The state of Georgia plans a ribbon-cutting ceremony for the factory on September 30.

Eric Hal Schwartz was an intern in Xconomy's Seattle office. Follow @

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