to bring the factory up to full-throttle capacity. That process should take about 14 months, Gold says. He didn’t break any news on whether Dendreon plans to open up a new factory somewhere else, but said, “We’re well-positioned to bring on additional capacity to meet demand as we go forward.”
—The company, through its clinical trials, has processed samples from about 3,000 patients, Gold said. Although Provenge has the opportunity to be the first drug of its kind approved by the FDA that works by stimulating the immune system to fight cancer, regulators are quite familiar with the process by which it is made in New Jersey, Gold said. The FDA took a close look at the manufacturing facility in 2007 when the company’s ill-fated original application was being considered, he said.
—Dendreon isn’t disclosing what it will charge for Provenge, but as Gold has said before, the price will be based on the drug’s ability to prolong life, and will be comparable to other biotech drugs. Using a conservative estimate, Provenge will probably cost $40,000 per patient, for a typical course of treatment, with three infusions spread over one month, said analyst Reni Benjamin of Rodman & Renshaw, in an April 29 note to clients. He estimates the drug will generate $137.5 million in sales in 2010, its first year on the market, assuming it captures 8 percent of the market for prostate cancer patients who have relapsed after prior hormone-deprivation therapy. Provenge will likely go on to capture 45 percent of this market by 2014, when it will eclipse $1.l billion in sales, Benjamin said.
—Investors also wanted to pin down Gold on the cost of raw materials of Provenge, known as “cost of goods sold” in accounting lingo. This is a key to determining how profitable the drug will be, along with the big variable about retail price. Gold wouldn’t provide a specific number on cost of goods, although it will probably start out at about 30 percent of the total retail price, and then start declining into the 20 percent range as production volume goes up, Gold says. Much of the cost will be from labor, he says. Gold declined to provide specifics when asked how labor-intensive it is to manufacture each dose. He also didn’t say how many people will need to be hired to run the New Jersey plant. The company currently has 82 job listings on its website, with 26 of them at the Morris Plains factory.
