Provenge, the autologous cellular immunotherapy for prostate cancer, was approved by the FDA in April 2010 and launched shortly thereafter. Since then Seattle-based Dendreon has faced significant problems with supply, and with generating demand.
As Dendreon could only provide Provenge for up to 2’000 patients in the 1st year, the early uptake was muted but could be easily explained. As the company built up additional manufacturing capacity, analysts expected product sales to soar, with some forecasting peak sales well in excess of a billion dollars. But generating demand for Provenge proved to be more difficult than Dendreon had anticipated – largely due to the pricing strategy adopted.
The result of this strategic decision has seen the market value of the company slashed by more than 60% since the Q2 results were announced on 3 August 2011.