Dendreon Corporation has turned to experienced oncology leader John Johnson to jumpstart the commercial launch of Provenge (sipuleucel-T) in the U.S. and expand into Europe. The Seattle biotech announced the appointment of the former Savient Pharmaceuticals Inc. and ImClone Systems CEO to succeed Mitchell Gold Feb. 1, a move likely to be welcomed by investors though it came as a surprise.

Johnson’s biggest challenge at Dendreon will be stabilizing the Provenge launch and convincing investors to give the company a second shot. Dendreon recently announced 2011 financial results above revised consensus, a sign of good faith the company has fixed some of the commercial road blocks Provenge hit the first year of launch Also see "Dendreon Rebounds In Q4 2011, But Can It Keep It Up In 2012?" - Pink Sheet, 10 January, 2012..

But the company has a long way to go to assure investors that Provenge can live up to its much-hyped potential, especially in an increasingly competitive prostate cancer treatment market. Dendreon went from Wall Street darling to demon in August when the company withdrew 2011 revenue projections of $350 million to $400 million, sparking a sell-off that led the stock to drop 65% Also see "Disappointing Provenge Sales Stir Doubts About Demand" - Pink Sheet, 4 August, 2011..

“Our next step is to make [Provenge] a foundation of care around the world,” Johnson said in a conference call announcing the succession plan. “My first task is one that will involve a lot of listening and a lot of asking questions.”

Johnson comes to the position as an experienced commercial oncology leader. He served as CEO of Savient for one year where he launched an unsuccessful initiative to sell the company. But he is better known as the former CEO of ImClone Systems. He led the biotech from August 2007 until November 2009, overseeing the global expansion of Erbitux and eventual sale of the company to Eli Lilly & Co.for $6.5 billion Also see "Lilly Snatches ImClone Away From Bristol" - Pink Sheet, 6 October, 2008..

Johnson has served on Dendreon’s board of directors since August. Gold has been elected executive chairman and will serve in that role until June 2012, at which point he will continue as director and Johnson will take over as chairman.

From Drug Developer To Commercial Marketer

For Dendreon, the leadership change marks the dawn of a new era for the company and highlights the challenges biotechs face transitioning from drug developer to commercial marketer. Gold was president and CEO of Dendreon for close to a decade. He successfully saw the cancer immunotherapy – the first of its kind – through development and a controversial regulatory approval, marked by delays. But after Provenge finally hit the market in April 2010, the company misjudged the drug’s early launch trajectory.

Most notably, the company failed to recognize the reimbursement obstacles, and particularly how uncertainty over CMS’ decision to launch a National Coverage Determination would slow uptake of the expensive $93,000 treatment. The company also miscalculated the education ramp-up that would be required, as asymptomatic, minimally symptomatic prostate cancer patients traditionally have been managed by urologists, who unlike oncologists do not typically administer complex infusion therapies Also see "With Dendreon Humbled, Lessons Learned For Cancer Vaccine Makers" - Pink Sheet, 22 August, 2011..

Dendreon has corrected some of the missteps. It formed a urologist-targeted sales force, for example, and challenges in reimbursement have eased, but Johnson will need to continue to address those issues, as well as new complexities that will emerge in the even more cost-constrained and fragmented European market. The company announced that its regulatory application in Europe has been formally accepted by the European Medicines Agency, putting Provenge on track for a potential regulatory approval in the middle of 2013.

Initially, Johnson said he will focus on three priorities: expanding the use of Provenge among physicians in the U.S. and assembling a team to guide the introduction of Provenge in Europe; reducing cost of goods; and advancing the pipeline.

The company will open an office on the East Coast, in New Jersey, to recruit additional talent to support the global rollout of the drug, he added. As for other potential changes – like pricing of Provenge or commercial structure – investors will have to wait and see.

Another lingering uncertainty for Dendreon is how Provenge ultimately will be positioned in the treatment paradigm for prostate cancer. The market is quickly evolving with the launch of new drugs demonstrating a survival advantage. Dendreon has been moving to control sequencing decisions by physicians, but the market will be shifting with more new entrants expected.

Johnson & Johnson’s Zytiga (abiraterone) launched in April 2011 for patients treated with chemotherapy, but it is being used off-label in some cases in chemotherapy-naïve patients, a group that is Provenge-eligible. A Phase III study testing Zytiga in chemo-naïve patients is ongoing.

In addition, Medivation Inc. announced positive Phase III data on its late-stage prostate cancer drug MDV3100 Jan. 31, demonstrating a survival benefit in patients previously treated with chemotherapy. Unlike Zytiga, MDV3100 will be administered without a steroid, potentially simplifying the decision to use it in sequence with Provenge. Medivation and its partner, Astellas Pharma Inc., are planning a pre-NDA meeting with FDA in 2012 to determine a filing path Also see "Phase III Data AFFIRM Safety As Well As Survival For MDV3100" - Pink Sheet, 31 January, 2012..

Savient Appoints Interim Chief

Meanwhile, Savient announced the appointment of David Norton, a member of its board of directors, to interim CEO while it conducts a search for a permanent chief. The company markets the gout treatment Krystexxa (pegloticase), which was approved in December 2010 with a Risk Evaluation & Mitigation Strategy and “black box” warning for anaphylaxis and infusion reactions. The company failed to find a marketing partner or a buyer. Fourth quarter sales of Krystexxa are expected to be between $2.8 million and $3 million, the company said.

A New Chapter, A New CEO For Dendreon

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