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on the market. That’s a bit lower than the average Wall Street analyst estimate of $4.4 million, cited by Robert W. Baird analyst Christopher Raymond in a report to clients yesterday. Even those puny sales expectations have been cut in half over the past couple months, as Dendreon tried to assure investors that it would take time to get all the necessary players at each medical facility—patients, doctors, insurers—operating in synch.
Dendreon’s process, by its nature, takes a while to get up and running. It’s not a matter of popping a pill from a bottle—the Dendreon regimen requires blood get withdrawn, filtered, sent to a factory to be “taught” to recognize cancer cells, and then have the blood re-infused. The patient gets three infusions over a month’s time. Doctors often want to see proof that insurers will reimburse on time before they ramp up their prescribing practice with multiple patients, Miller says.
“The launch is going how Dendreon expected,” Miller says. “They expected it to be slow.”
Based on Miller’s model, Dendreon should generate $3.1 million in sales in the quarter ended June 30, and then ramp up to $20 million in the following quarter, and $31 million in the final quarter of this year. That means Dendreon should generate a total of about $54 million in 2010, Miller says.
The sales numbers are supposed to get a whole lot bigger in 2011 and 2012. Dendreon is only operating at about one-fourth of its manufacturing capacity at a plant in New Jersey, and it is working fast to set up more capacity in Georgia and southern California. This is a very expensive push—the company has said it plans to spend $460 million of its cash this year, much of it to maximize the marketing and manufacturing push for Provenge. JP Morgan analyst Cory Kasimov has forecasted $1.5 billion in sales in 2014 for the Dendreon product.
I’ll be listening in later today on the conference call, and providing a quick report on how much of the drug Dendreon is selling, how it is managing its expenses, the latest on Medicare reimbursement on the regional and national level, and any updates on the state of Dendreon’s manufacturing capabilities. If you have any specific questions you’d like me to ask, leave a comment at the bottom of this story, and I’ll see if I can get you an answer.
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