In an attempt to break even in the cash-intensive biotech game following a rough start with its prostate cancer drug, Dendreon is handing pink slips to a quarter of its employees and saying goodbye to COO Hans Bishop.
The job cuts announced yesterday were expected after the Seattle-based biotech ($DNDN) disappointed with lower-than-expected sales of Provenge, its innovative immunotherapy against prostate tumors. Roughly 80% of the jobs being slashed come from the manufacturing organization quickly amassed in recent years to prepare for the drug's launch, according to a Seattle Times article. About 100 workers in Seattle who hold back-office and finance jobs also are getting walking papers, the paper reports.
"When we realized we would not be on a run rate of $175 million to $200 million in the fourth quarter, we had to reduce the head count in our plants to a more gradual ramp," Dendreon CEO Mitch Gold told the Times. The company provided scant details about Bishop's departure.
Dendreon reported $22 million in Provenge sales last month, and executives said its revenue outlook, work-force reduction savings and its $600 million in available capital at the end of August were sufficient to climb out of the red and reach a break-even point. But Wall Street seemed unmoved by the restructuring, and the firm's stock was trading this morning at around $11 per share, down about 70% since the now infamous sales numbers were released in early August.
- here's the company's release
- see the Seattle Times' report