Gilead Wagers $600M on Calistoga, Dendreon Scopes New Digs, Physio to Spin Off, & More Seattle-Area Life Sciences News

2/24/11Follow @xconomy

This week’s news flow was dominated by a pretty rare event—a lucrative acquisition of a Seattle-based, venture-backed biotech company.

Calistoga Pharmaceuticals hit the jackpot this week, as it agreed to be acquired by Foster City, CA-based Gilead Sciences (NASDAQ: GILD) for as much as $600 million if certain milestones are reached. The deal is interesting not just locally, but nationally as well, because it represents Gilead’s first serious foray into the cancer drug business. Calistoga CEO Carol Gallagher says she’s hopeful that most of the company’s 23 employees will be retained at Gilead’s new research center along Lake Union. I also had a follow-up conversation with Gilead’s chief scientist, Norbert Bischofberger, about why Gilead is making the move into cancer and inflammatory diseases now.

Physio-Control, the storied Redmond, WA-based maker of heart defibrillators, could once again become an independent company, through a spinoff being proposed by its parent, Minneapolis, MN-based Medtronic (NYSE: MDT). Physio-Control had about 1,100 employees as of a year ago, with about three-fourths of them in Redmond.

Bruce Montgomery, the prominent Seattle biotech entrepreneur, has pulled in the first $1 million of financing for a new company he’s working on called Cardeas Pharma. Montgomery has teamed up with Melissa Yaeger, a former colleague at Seattle-based Corus Pharma and Gilead Sciences. No word yet on what Cardeas is doing, but I’m checking.

—Seattle’s best-known biotech company, Dendreon (NASDAQ: DNDN), is apparently scoping out some downtown office space with potential to wow big East Coast portfolio managers coming through town. Dendreon is reportedly in talks to take office space in the Russell Investments Center with a towering view over downtown, Elliott Bay, and the Olympics. No final decision has been made, a company spokeswoman told The Seattle Times.

Microsoft (NASDAQ: MSFT) has joined forces with Watertown, MA Athenahealth (NASDAQ: ATHN) to make their electronic medical record offerings more compatible and easier for healthcare professionals to use.

—We also had two biotech-themed guest editorials this week. Chris Rivera, the president of the Washington Biotechnology & Biomedical Association, offered his take on how the local innovation community can play a key role in sparking a broader economic recovery. And David Miller, president of Seattle-based Biotech Stock Research, talked about how health insurance costs are becoming a much more serious impediment to new company creation than ever before.

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  • http://n/a John

    Luke

    LOL
    Love ALL of your articles on DNDN, but seriously..!
    “DNDN is scoping out out some downtown office space with potential to wow big East Coast portfolio managers coming through town”

    And what is your source?
    So DNDN won’t invite these folks over to HQ (which I’m sure isn’t a dump) until they close the real estate deal so they can then impress those managers???

    Please tell me this is true and to just shut up so I can get real excited!
    John

  • http://www.xconomy.com/author/ltimmerman/ Luke Timmerman

    John–I’m being a little bit cheeky in that reference. Dendreon has had investors in to see its older building, but I’m sure it will be happy to show off the nice new digs to visitors.

  • http://na John

    True!
    LOL!
    Thanx Luke!

    I enjoy your articles and do appreciate the gems of info you provide on DNDN (ie: Dr. Gold reads your articles; investors do visit DNDN HQ).
    Not related, but transparancy builds trust!

    Can’t wait till next Tuesday, 4:30pm.
    I have a feeling that the NJ facility has been FDA approved or else we wait until March 12th at the latest for an official announcement (4 mths from Nov 12, 2010 when the sBLA for NJ was submitted to the FDA).

    Keep up the accurate reporting on DNDN. It’s sometimes frustrating reading biased articles on dndn from other influential media outlets (ie: Forbes, etc).

    John

  • http://na John

    Luke,

    Thought I’d share this w/ you as Adam F says he knows DNDN shorts are “alive and well and “thinking DNDN won’t hit their $350M-$400M guidance.
    See 7:24 mark in following link:
    http://www.thestreet.com/_yahoo/story/11008155/1/bio-ceo-conference-live-blog-day-2.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA
    Adam F must know some dndn shorts personally to say such a thing….

    Here’s my view:
    DNDN needs to treat 4,301 patients in 2011 to hit the high end of Dr. Gold’s $400M guidance!

    If in May we learn that DNDN did $30M in Q1/2011, that is approx 320 patients at 25% NJ capacity.

    If during Q2, NJ is at 100% capacity, we can take 320 x 4 or approximate that 1260 potential patients will be treated during Q2, Q3, & Q4
    or 3780 total patients treated from NJ for the last 3 quarters.

    Now add 3780 + 320 from Q1 and you get 4100 patients treated just from the NJ plant.
    Notice that if NJ is FDA approved in early March (during Q1), the end result may be higher!

    If CA & GA come online on July 1st all they need to treat is 201 patients TOTAL during Q3 & Q4 to hit the 4,301 mark or $400M as projected by Dr. Gold!

    I trust CEO Dr. Gold will underpromise/overdeliver by year end because I suspect some analysts will have their own 2011 forecasts and “some analyst forecasts” maybe higher than DNDN’s forecast to make DNDN “fails to meet consensus analyst forecasts.
    Fortunately, I think the average analyst consensus will be in the same range as what Dr. Gold guided ($350M-$400M).

    My figures above also depend how quickly hiring & training proceed for the 3 facilities during this year too!
    thanx…!
    And GO DNDN!