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Dendreon May Not Survive Its Success: Q&A with Founder Chris Henney, Part 1

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by market cap by far. There’s no one close.

X: Right, but they only have a couple hundred employees. Can they get to the point of being fully integrated here?

CH: Immunex for a time had a market cap bigger than Boeing, when we only had 1,000 people. Immunex was the second-biggest company in the Northwest by market cap, behind Microsoft. Bigger than Boeing by market cap, which had 100,000 employees. You can’t go by numbers of people, because it will never get there.

X: Yes, but I’m talking about it being a regional anchor for your biotech cluster, like Biogen and Genzyme are for Boston, and Genentech has been for the San Francisco Bay Area.

CH: Yes, Biogen, Genzyme, Genentech, and Amgen are the original companies. They are the ones who have survived from the first round of companies from back in the early 1980s. Not many of them survive. You saw Medarex, which is a second or third-generation company, just got bought out yesterday (July 23) by Bristol-Myers Squibb. You can organically grow to $2 or $3 billion, but you need a slew of products (to continue). This is why Amgen bought Immunex, There aren’t too many billion dollar products in the biotech industry. Immunex, with Enbrel, had one. That’s why it got bought. It’s easier to have the market cap of a ZymoGenetics ($367 million) and stay around in town. But to stay as an independent company, with a several billion dollar market cap, would be very unusual.

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    I am very concerned that the alleged corruption surrounding DNDN is very real. “Deep Capture” has presented the facts beautifully and one must take their facts seriously. In sum, I believe Dendreon was indeed railroaded 2 years ago when they did not get FDA approval. Corruption and conflict of interests both at the FDA and other places played an important role in an attempt to kill Dendreon. Yet, as of today, still nothing has been done by the authorities to expose and or punish these criminals. Say what you wish. But, 600+ men have died because of greedy, heartless, money hungry corrupted individuals who obviously do not care about anyones life except theirs.

  • Warlord_2010

    “There were a small minority who wanted more data, but that’s pretty common.” He is being kind! What he should have said is that there was a small minority that was so conflicted they never should have voted, much less been seated on the Advisory Committee! Read http://www.deepcapture.com to see not only how corrupted was the FDA review of Provenge, but how ten hedge funds colluded in a failed attempt to destroy Dendreon. That people provided evidence of this to the SEC and to the HHS IG more than 2 years ago, and that nothing was done, speaks volumes about how ineffective these two agencies are in rooting out corruption…assuming that they even have the least bit of understanding what is going on under their noses. Both the SEC and HHS need a good housecleaning, beginning at the highest. The fact is, nothing has changed in these two agencies…they continue on, business as usual, as they have for the last 9 years. And meanwhile, between May 8, 2007, when the FDA asked for more data, and now, 65,000 men have died of prostate cancer. Many could have been helped by Provenge. And the data the FDA wanted? Well, as seen in the article, it was released on April 28, 2009, and it showed what the FDA knew on March 29, 2007: the drug is safe and effective. Our FDA: what a poor excuse for an agency charged with protecting the health of the American Public. As Joseph Stalin once said: One man’s death is a tragedy, a million is a statistic.” Or was it our FDA?

  • Luke, I am now getting confimation from Chris Henney what I was hearing from David Miller at the Investor Village get together the night before the Dendreon shareholder meeting this year.

    I would prefer to see Dendreon remain independant but these days it is tough. Also big pharma wants to see that a little biotech can not only succeed in phase three but also get the product through the FDA and then be able to produce the product in quanity and finally be able to sell and get reimbursed for it.

    Yes…too complicated. But if Dendreon can do all these things, they will be acquired or have to fight like hell to stay independant.

    Luke, again, thanks for just the facts. So many other media sources just can’t do that.


  • Steven, that’s an interesting point you raise. It sounds like you’re saying that Big Pharma wants to see more risk removed from the equation at Dendreon before it is willing to acquire the company. I’m curious what other readers think those essential steps are: FDA approval, manufacturing scale-up, Medicare reimbursement at the company’s desired price, early sales momentum, or more?

  • Steven is not correct. Just look at the recent J&J acquisition of another prostate cancer company, Cougar Biotech (symbol was CGRB) for $894 million. Cougar has two Phase III trials in process with no results yet. About where DNDN was in early 2006.

  • I asked my boss, you could have gotten that property a lot cheaper, why did you bid so high? he answered, I wanted it. I think Big Pharma with the deepest pockets think the same way. Do your DD and it points to only one high buck phama by far, but M. Gold ain`t sellin`. Get it?