Dendreon Announces Third Quarter 2012 Results

  Dendreon Announces Third Quarter 2012 Results

                          – Restructuring on Track –

      – Conference Call to be Hosted November 2, 2012 at 9:00 a.m. ET –

Business Wire

SEATTLE -- November 02, 2012

November 2, 2012– Dendreon Corporation (Nasdaq: DNDN) today reported results
for the quarter ended September 30, 2012. Net product revenue for the quarter
was $78 million, compared to $61 million for the quarter ended September 30,
2011, up 27% year over year and down 2.5% on a sequential basis.

Net loss in the third quarter of 2012 was $154.9 million, or $1.04 per share,
compared to a net loss of $147.1 million, or $1.00 per share, for the same
period in 2011. The current period includes a one-time charge of approximately
$81 million related to cash and non-cash restructuring expenses. Excluding
these expenses and other non-cash charges, the Company had a non-GAAP loss of
approximately $50 million, or $0.33 per share.

As of September 30, 2012, Dendreon had approximately $445.1 million in cash,
cash equivalents, and short-term and long-term investments, compared to $617.7
million as of December 31, 2011.

Recent Highlights:

  *Delivered solid performance in community accounts:

       *Community urology grew 14% overall quarter over quarter; accounts
         serviced by the new key account management team put in place earlier
         this year grew 16%, demonstrating that commercial investments made
         earlier in the year are paying off
       *Performance in community oncology was essentially flat (a decrease of
         less than 1%), representing an improvement over the 8% decline in the
         second quarter
       *Performance in academic medical centers declined 25%, which we
         believe is largely driven by an increase in clinical trial activity
         and site activation by other companies

  *Continued new physician interest in PROVENGE® (sipuleucel-T):

       *Added 54 net new accounts in the third quarter, bringing total number
         of infusing accounts to 741

  *Continued improvement in reimbursement landscape for physicians:

       *Aetna enhanced its coverage policy for PROVENGE prescribers
       *Received contract award from the Department of Veterans Affairs
       *Reported average time to payment remains less than 30 days for
         physicians

  *Implemented direct-to-consumer initiatives:

       *Continued PROPEL education series, with physicians presenting an
         overview of PROVENGE to patients at local and regional prostate
         cancer support group meetings
       *During Prostate Cancer Awareness Month, executed national media
         campaign to raise awareness in disparity of prostate cancer in
         African American men and hosted community events to disseminate
         PROVENGE information to patients, families and caregivers

  *Restructuring is on track:

       *Expense reductions are as expected, which bring administrative
         functions in line with companies of comparable size and complexity
       *Expect to begin to see net benefits associated with the restructuring
         initiatives to begin to appear in financial results as early as the
         first half of 2013, with full benefits realized in the third quarter
         of 2013
       *Expect to continue to reduce cost of goods sold (COGS) and anticipate
         seeing COGS below 50% following the closure of the Morris Plains, NJ
         facility, which is scheduled to close by the end of 2012
       *Expect to begin generating positive cash-flow from US operations at
         $100 million in quarterly sales

  *Continued focus on clinical data:

       *Data presented at European Society for Medical Oncology’s (ESMO)
         annual congress continues to provide important insights into the
         treatment of advanced prostate cancer with PROVENGE
       *Actively evaluating partnering strategies for European expansion;
         completed first patient’s treatment in the sipuleucel-T European
         Union open-label study; expect a mid-2013 regulatory decision in
         Europe
       *Completed enrollment of Zytiga (abiraterone acetate) sequencing
         study; expect to present data in 2013
       *Made decision to proceed with Xtandi (enzalutamide) sequencing study

“We delivered strong growth in urology and have continued to improve results
in oncology, which demonstrate our commercial progress,” said John H. Johnson,
chairman, president and chief executive officer. “These results were offset by
a decline in the academic setting, which we believe is being driven by an
increase in clinical trial activity from other companies. That said, we are
pleased with the progress we’ve made in strengthening our commercial
organization.”

“With our restructuring on track, we believe we are in a strong financial
position and are looking to the future as we meet the growing interest for
PROVENGE in the marketplace,” concluded Mr. Johnson.

Conference Call Information

Dendreonwill host a conference call onNovember 2, 2012at9:00 a.m. ET. To
access the live call, dial 1-877-548-9590 (domestic) or +1-720-545-0037
(international); the conference ID number is 38408702. The call will also be
audio webcast with supplemental information slides available from the
Company's website at http://www.dendreon.comunder the “Investor/Webcasts and
Presentations” section. A recorded rebroadcast will be available for
interested parties unable to participate in the live conference call by
dialing 1- 800-585-8367 or +1-404-537-3406 for international callers; the
conference ID number is 38408702. The replay will be available from 12:00 p.m.
ET on Friday, November 2, 2012 until 11:59 p.m. ET on Thursday, November 8,
2012. In addition, the webcast will be archived for on-demand listening for 90
days at www.dendreon.com and the supplemental information slides will be
posted to the Company’s website.

PROVENGE Indication and Important Safety Information

PROVENGE (sipuleucel-T) is an autologous cellular immunotherapy indicated for
the treatment of asymptomatic or minimally symptomatic metastatic castrate
resistant (hormone refractory) prostate cancer.

PROVENGE is intended solely for autologous use and is not routinely tested for
transmissible infectious diseases.

The safety evaluation of PROVENGE was based on 601 prostate cancer patients in
four randomized clinical trials who underwent at least one leukapheresis. The
most common adverse events (incidence greater-than or equal to 15%) are
chills, fatigue, fever, back pain, nausea, joint ache, and headache. Serious
adverse events reported in the PROVENGE group include acute infusion reactions
(occurring within 1 day of infusion) and cerebrovascular events. In controlled
clinical trials, severe (Grade 3) acute infusion reactions were reported in
3.5% of patients in the PROVENGE group. Reactions included chills, fever,
fatigue, asthenia, dyspnea, hypoxia, bronchospasm, dizziness, headache,
hypertension, muscle ache, nausea, and vomiting. No Grade 4 or 5 acute
infusion reactions were reported in patients in the PROVENGE group.

To fulfill a post marketing requirement and as a part of the company's ongoing
commitment to patients, Dendreon will conduct a registry of approximately 1500
patients to further evaluate a small potential safety signal of
cerebrovascular events. In four randomized clinical trials of PROVENGE in
prostate cancer patients, cerebrovascular events were observed in 3.5% of
patients in the PROVENGE group compared with 2.6% of patients in the control
group.

For more information on PROVENGE, please see the full prescribing information
at http://www.provenge.com or call 1-877-336-3736.

About Dendreon

Dendreon Corporation is a biotechnology company whose mission is to target
cancer and transform lives through the discovery, development,
commercialization and manufacturing of novel therapeutics. The Company applies
its expertise in antigen identification, engineering and cell processing to
produce active cellular immunotherapy (ACI) product candidates designed to
stimulate an immune response in a variety of tumor types. Dendreon’s first
product, PROVENGE® (sipuleucel-T), was approved by the U.S. Food and Drug
Administration (FDA) in April 2010. Dendreon is exploring the application of
additional ACI product candidates and small molecules for the potential
treatment of a variety of cancers. The Company is headquartered in Seattle,
Washington, and is traded on the NASDAQ Global Market under the symbol DNDN.
For more information about the Company and its programs, visit
http://www.dendreon.com/.

Statements in this press release that are not strictly historical in nature
constitute “forward-looking statements.” Such statements include, but are not
limited to, statements regarding the expected benefits of the restructuring,
the timing and elements of the restructuring, the timing and form of related
charges, the expected annual operating expense reduction, expectations and
beliefs regarding Dendreon’s profitability and Dendreon’s ability to achieve
improved performance as a result of the restructuring, expectations regarding
regulatory approval of PROVENGE in Europe, expectations regarding the
presentation of clinical data, developments affecting Dendreon's business and
prospects and potential revenue and earnings from product sales, and progress
generally on commercialization efforts for PROVENGE. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause Dendreon’s actual results to be materially different from
historical results or from any results expressed or implied by such
forward-looking statements. These factors include, but are not limited to, our
inability to achieve and sustain commercial success for PROVENGE; the
identification of efficacy, safety or other issues with PROVENGE; a slower
than anticipated adoption by treating physicians of PROVENGE for the treatment
of patients with advanced prostate cancer due to competing therapies,
perceived difficulties in the treatment process, delays in obtaining
reimbursement or for other reasons; any promotional limitations imposed by the
FDA on our ability to commercialize and market PROVENGE; unexpected
difficulties and costs associated with the rapid expansion of our operations
to support the commercial launch of PROVENGE; and other factors discussed in
the “Risk Factors” section of Dendreon’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 2012. All forward-looking statements are qualified
in their entirety by this cautionary statement. Dendreon is providing this
information as of the date of this release and does not undertake any
obligation to update any forward-looking statements contained in this release
as a result of new information, future events or otherwise.

DENDREON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
                                                               
                     Three Months Ended                  Nine Months Ended
                     September 30,                       September 30,
                     2012             2011               2012             2011
                     (unaudited)                         (unaudited)
                                                                          
Product              $ 77,942         $ 61,409           $ 239,878        $ 136,549
revenue, net
Royalty and           29             2,878            159            2,919    
other revenue
Total revenue          77,971           64,287             240,037          139,468
                                                                          
Operating
expenses:
Cost of
product                51,749           54,978             173,521          102,070
revenue
Research and           18,643           20,417             55,683           56,591
development
Selling,
general and            68,109           84,920             243,643          285,280
administrative
Restructuring,
contract
termination           80,994         38,482           81,969         38,482   
and asset
impairment
Total
operating             219,495        198,797          554,816        482,423  
expenses
Loss from              (141,524 )       (134,510 )         (314,779 )       (342,955 )
operations
Interest               313              285                1,071            1,078
income
Interest               (13,732  )       (12,910  )         (41,312  )       (34,024  )
expense
Other income          79             24               105            (2       )
(expense)
Net loss             $ (154,864 )     $ (147,111 )       $ (354,915 )     $ (375,903 )
                                                                          
Basic and
diluted net          $ (1.04    )     $ (1.00    )       $ (2.39    )     $ (2.58    )
loss per share
                                                                       
Shares used in
computation of
basic and             149,593        146,426          148,455        145,953  
diluted net
loss per share
                                                                          

                                           September 30,    December 31,
                                              2012                2011
Balance Sheet Data:
Cash and cash equivalents                     $   226,696         $  427,100
Short-term investments                            163,519            111,525
Long-term investments                            54,854            79,071
Total cash and cash equivalents,
short-term investments and long-term              445,069            617,696
investments
Trade accounts receivable                         38,307             35,541
Prepaid antigen costs                             963                7,490
Inventory                                         68,594             69,502
Total assets                                      742,093            1,001,491
Convertible senior notes due 2016                 526,477            508,418
Convertible senior subordinated notes             27,685             27,685
due 2014
Total stockholders' equity                        57,828             352,637
                                                                     

DENDREON CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP NET LOSS
(in thousands, except per share amounts)
                                                               
                     Three Months Ended                  Nine Months Ended
                     September 30,                       September 30,
                     2012             2011               2012             2011
                     (unaudited)                         (unaudited)
                                                                          
GAAP net loss        $ (154,864 )     $ (147,111 )       $ (354,915 )     $ (375,903 )
Non-GAAP
adjustments:
Depreciation
and                    9,498            9,842              31,152           25,797
amortization
expense
Imputed
interest
related to the         6,142            5,664              18,059           15,515
convertible
senior notes
due 2016
Restructuring,
contract
termination
and asset
impairment,
including
stock-based
compensation
expense:
Severance,
contract
termination            14,009           18,630             14,984           18,630
and other
expense
Non-cash
stock-based            1,690            5,022              1,690            5,022
compensation
expense
Non-cash asset         65,295           14,830             65,295           14,830
impairment
Management
severance and
other
termination
benefits:
Severance              —                —                  6,965            —
expense
Non-cash
stock-based            —                —                  15,112           —
compensation
expense
Other
stock-based           8,194          11,684           40,462         43,114   
compensation
expense
Non-GAAP net         $ (50,036  )     $ (81,439  )       $ (161,196 )     $ (252,995 )
loss
                                                                          
Non-GAAP net
loss per             $ (0.33    )     $ (0.56    )       $ (1.09    )     $ (1.73    )
share- basic
and diluted
                                                                       
Shares used in
computation of
basic and             149,593        146,426          148,455        145,953  
diluted net
loss per share
                                                                                     

The above table provides certain non-GAAP financial measures that include
adjustments to GAAP figures. Dendreon believes that these non-GAAP financial
measures, when considered together with the GAAP figures, can enhance an
overall understanding of Dendreon's financial performance and its prospects
for the future. The non-GAAP financial measures are included with the intent
of providing investors with a more complete understanding of operational
results and trends. We believe excluding these items provides important
insight into our operational results, important for a company at our stage in
development. In addition, these non-GAAP financial measures are among the
indicators Dendreon management uses for planning and forecasting purposes and
measuring the Company's performance. These non-GAAP financial measures are not
intended to be considered in isolation or as a substitute for GAAP figures.

Contact:

Dendreon Corporation
Investor Relations
Nicole Soley, 206-455-2220
InvestorRelations@dendreon.com
 
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