Adam Feuerstein: "Does anyone remember second quarter 2011 when former CEO Mitch Gold admitted that Provenge's sales growth was being hampered by "cost density" and insurance reimbursement problems?
David Miller of Biotech Stock Research -- a stalwart Dendreon bull -- remembers well but says Monday's issues are far worse":
"Well, that was ugly. To our ears, this conference call was much worse than the one we endured last August," wrote Miller in a research note to his investor clients. "The debacle last August was unexpected to most, but we saw a clear path towards fixing it… Now let's move forward a year. We have a new CEO and, apparently, a brand new commercial team from the top down. We've ping-ponged from a commitment to urology to a commitment to everything. Another 600 people have lost their jobs and were down one manufacturing plant. Worse, Dendreon is shooting for break even instead of a blockbuster. Well, they'll be lucky to hit breakeven after what we heard today."
Indeed, a year ago, my first response was "what's the big deal, they aren't as fast out of the gate as hoped, they are 6 months behind the original sales profile" and I was amazed at the market response.
As a great believer in the science and effectiveness of Provenge, I was a firm supporter of the company for most of the past year.
But, slowly, I've come to realize how systemic Gold's criminal culture was. It's so deep that he's still here. It has so screwed up the company, they can't keep a sales force. And, yes, a sales force is important. There are a few Provenge pushers out there, but most doctors are going to be in the "curious, but don't know enough" camp. When they don't get phone calls returned, they become skeptical of the company and product.
Indeed, think about how many infusion sites there are that have never infused! That's a sure sign of meltdown in the sales force.
Now, I'm so disgusted by the pervasive criminality that I'm now siding with the ones who call it D'Enron, Bulgaria, etc. Given the incredible behavior of top people, I also see them capable of fudging science and trials. I'd be looking around trying to see if there are independent reasons I should believe the trial. I think the Huber work is bigger trash. And, there are trends in reanalysis that fit my tendency to believe. But, then, if you were faking things, surely you'd want the results seen, e.g. better at early stage, low PSA level.
As long as there are so many criminals on board, the company is too tainted to succeed. The sales force will stay in shambles. The scientists who could keep a product pipeline will leave. The company will go into a cost cutting death spiral with ever lower sales and suspicion of the entire enterprise. The great promise of future products gone.
The continued abetting also means there is no chance that any company will take on the liability. Without a big pharma behind this, the suits are going to kill the company. For a BP with deep pockets at trial, the liability is just too high. And the criminal culture still so pervasive that one has to suspect the product--a product that now has declining sales.
All just because they won't do what other companies have done when they have criminals on board--cut them loose!
If Provenge is what I'd like to think it is, it's nearly a cure for prostate cancer when used early. When sequences with the other treatments, you are likely to die of something else, even if you never become cancer free.
Yet, here's a company that has thrown away that tremendous contribution to the world?
How: Gold pumped and dumped his stock. He and his cronies are still high lever officers.
Qwest got rid of their guys. McAfee had to clean up their act, they did it slowly enough that the company barely survivied (there, the SEC was faster), IMCLONE cleaned up, Enron stayed criminal to the grave. Dendreon is chosing the last path.
How sad for the employees and prostate cancer patients that greed and cronyism will kill this company.
Criminals on board, declining sales, massive RIFs, a dysfunctional sales force..
How can there be any doubt about bankruptcy now. Yes, Mr. Angry CFO will say that it will take more quarters than I will guess, but really, again, criminals on board with no cleanup in sight, no sales force with no sensible person willing to join, massive RIFS, declining sales.
That spells bankruptcy. Let's hope it takes fewer quarters so the technology yard sale lets someone see if the drug is real and gets it to market.
Tragic, deeply tragic.
Here,
change means the former CEO goes to jail
hope is the Feds coming in and closing the place tomorrow, so the technology can be used in the war on cancer
