Dendreon Announces Fourth Quarter and 2012 Year End Results

  Dendreon Announces Fourth Quarter and 2012 Year End Results

      – Conference Call to be Hosted February 25, 2013 at 9:00 a.m. ET –

Business Wire

SEATTLE -- February 25, 2013

Dendreon Corporation (Nasdaq: DNDN) today reported results for the fourth
quarter and full year ended December 31, 2012. Net product revenue for the
year ended December 31, 2012 was $325.3 million compared to $213.5 million for
the year ended December 31, 2011. Net product revenue for the fourth quarter
ended December 31, 2012 was $85.5 million, which includes a $3.8 million
favorable adjustment to the Company’s chargebacks reserve due to a change in
estimate. On a pro-forma basis, excluding this adjustment, net product revenue
for the quarter and year ended December 31, 2012 was $81.6 million and $321.5
million, respectively, up 5% on a sequential quarter over quarter basis and
51% year over year.

Net loss for the year ended December 31, 2012 was $393.6 million, or $2.65 per
share, compared to $337.8 million, or $2.31 per share for the year ended
December 31, 2011.

As of December 31, 2012, Dendreon had approximately $429.8 million in cash,
cash equivalents, and short-term and long-term investments, compared to $617.7
million as of December 31, 2011.

Fourth Quarter Highlights:

  *Continued strong performance in community accounts:

       *Community urology grew 25% overall quarter over quarter
       *Community oncology grew 4% overall quarter over quarter
       *Community accounts represent 71% of total sales, up from 58% in the
         fourth quarter of 2011
       *Natural shift away from academic, which declined 9% quarter over
         quarter

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

       *Added 61 net new accounts in the fourth quarter, bringing total
         number of infusing accounts to 802

  *Continued improvement in reimbursement landscape for physicians

       *Noridian enhanced its coverage policy for PROVENGE prescribers
       *Reported average time to payment remains less than 30 days for
         physicians

  *Announced direct-to-consumer advertising campaign

       *Addresses significant need for patient education and awareness
       *National campaign targeted to key markets with efficient media buy of
         approximately $5 million per quarter
       *First commercial to air early in the second quarter of 2013; will be
         previewed live on the earnings call

  *Continue making progress with strategic restructuring:

       *Sold interest in Morris Plains, NJ facility to Novartis for $43
         million and preserved approximately 100 jobs
       *Expect to reduce cost of goods sold (COGS) to below 50% of net
         product revenue in the beginning of the third quarter 2013
       *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

  *Continued focus on expanding clinical data:

       *Data presented at the American Society of Clinical Oncology
         Genitourinary Cancers Symposium (ASCO-GU) continues to provide
         important insights into the treatment of advanced prostate cancer
         with PROVENGE, particularly as it relates to investigational uses of
         PROVENGE in combination or sequenced with other treatments
       *Actively evaluating partnering strategies for European expansion;
         continuing to enroll patients in the sipuleucel-T European Union
         open-label study; expect a mid-2013 regulatory decision in Europe
       *Completed enrollment of PROVENGE and ADT sequencing study; presented
         initial data at ASCO-GU and expect to present additional data in 2013
       *Completed enrollment of PROVENGE and Zytiga^® (abiraterone)
         sequencing study; presented initial data at ASCO-GU and expect to
         present additional data in 2013
       *Initiating an early detection registry, in which men with castrate
         resistant prostate cancer but without known metastases, will be
         imaged regularly for evidence of metastatic disease

“We are pleased to have delivered a strong quarter for community sales,” said
John H. Johnson, chairman, president and chief executive officer. “Given the
need for increased patient awareness and education, we will build on our
direct-to-consumer programs with targeted advertising beginning in the second
quarter. As we work to drive the top line, we continue to reduce our cost of
goods sold and streamline our cost position, and expect to begin to see net
benefits of these actions as early as the first half of 2013.”

Conference Call Information

Dendreonwill host a conference call onFebruary 25, 2013at9:00 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 95297228. 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 95297228. The replay will be available from 12:00 p.m.
ET on Monday, February 25, 2013 until 11:59 p.m. ET on Sunday, March 3, 2013.
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 financial position, profitability and Dendreon's
ability to break even and achieve improved performance as a result of the
restructuring, expectations regarding reductions of cost of goods sold,
expectations regarding regulatory approval of PROVENGE® in Europe,
expectations regarding the presentation of clinical data, developments
affecting Dendreon's U.S. and global business and prospects and potential
revenue and earnings from product sales, expectations regarding market size
and market opportunity, beliefs regarding the impact of our direct to consumer
advertising, expectations with respect to our sales force execution, 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,
instability in our sales force, including the risk that we cannot replace
vacant sales positions on a prompt basis, 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; the
impact of competing therapies on sales of PROVENGE, and other factors
discussed in the "Risk Factors" section of Dendreon's Annual Report on Form
10-K for the year ended December 31, 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 press 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                  Year Ended
                     December 31,                        December 31,
                      2012            2011            2012             2011     
                                                         
                                                                            
Product              $ 85,455          $ 76,962          $ 325,333          $ 213,511
revenue, net
Royalty and           38              125,183         197              128,102  
other revenue
Total revenue          85,493            202,145           325,530            341,613
                                                                            
Operating
expenses:
Cost of
product                54,371            57,020            227,892            159,090
revenue
Research and           18,960            17,699            74,643             74,290
development
Selling,
general and            73,488            76,062            317,131            361,342
administrative
Restructuring,
contract
termination           (36,302 )        105             45,667           38,587   
and asset
impairment
Total
operating             110,517         150,886         665,333          633,309  
expenses
Income (loss)
from                   (25,024 )         51,259            (339,803 )         (291,696 )
operations
Interest               273               337               1,344              1,415
income
Interest               (13,940 )         (13,681 )         (55,252  )         (47,705  )
expense
Other income          (4      )        182             101              180      
(expense)
Net income           $ (38,695 )       $ 38,097         $ (393,610 )       $ (337,806 )
(loss)
                                                                            
Basic and
diluted net          $ (0.26   )       $ 0.26           $ (2.65    )       $ (2.31    )
income (loss)
per share
                                                                            
Shares used in
computation of                                                           
basic
net income
(loss) per            149,737         146,789         148,777          146,163  
share
                                                                            
Shares used in
computation of                                                           
diluted
net income
(loss) per            149,737         150,163         148,777          146,163  
share
                                                                                       

                                                        
                                               December 31,       December 31,
                                               2012               2011
      Balance Sheet Data:
      Cash and cash equivalents                $   188,408        $  427,100
      Short-term investments                       165,396           111,525
      Long-term investments                       76,045           79,071
      Total cash and cash equivalents,
      short-term investments and               $   429,849        $  617,696
      long-term investments
      Trade accounts receivable                    38,884            35,541
      Prepaid antigen costs                        643               7,490
      Inventory                                    76,300            69,502
      Total assets                                 721,119           1,001,491
      Convertible senior notes due 2016            532,744           508,418
      Convertible senior subordinated              27,685            27,685
      notes due 2014
      Total stockholders' equity                   34,613            352,637
                                                                     


DENDREON CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP NET LOSS
(in thousands, except per share amounts)
                                                                
                     Three Months Ended                   Year Ended
                     December 31,                         December 31,
                      2012            2011             2012             2011     
                     (unaudited)                          (unaudited)
                                                                             
GAAP net             $ (38,695 )       $ 38,097           $ (393,610 )       $ (337,806 )
income (loss)
Non-GAAP
adjustments:
Depreciation
and                    8,505             10,877             39,657             36,674
amortization
expense
Imputed
interest
related to the         6,267             5,779              24,326             21,294
convertible
senior notes
due 2016
Restructuring,
contract
termination
and asset
impairment,
including
stock-based
compensation
expense:
Severance,
contract
termination            10,815            105                25,819             18,735
and other
expense
Non-cash
stock-based            325               —                  2,015              5,022
compensation
expense
Non-cash asset         (47,442 )         —                  17,833             14,830
impairment
Management
severance and
other
termination
benefits:
Severance              801               —                  7,766              —
expense
Non-cash
stock-based            1,179             —                  16,291             —
compensation
expense
Other
stock-based            12,905            12,125             53,367             55,239
compensation
expense
Royalty
payment
related to            —               (125,000 )        —                (125,000 )
sale of
VICTRELIS^TM
Non-GAAP net         $ (45,340 )       $ (58,017  )       $ (206,536 )       $ (311,012 )
income (loss)
                                                                             
Non-GAAP net
income (loss)        $ (0.30   )       $ (0.40    )       $ (1.39    )       $ (2.13    )
per share-
basic
                                                                             
Shares used in
computation of                                                            
basic
net income
(loss) per            149,737         146,789          148,777          146,163  
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
Corporate Communications
Lindsay Rocco, 862-596-1304
media@dendreon.com
or
Joele Frank, Wilkinson Brimmer Katcher
Investor Relations
Andrea Rose, 212-355-4449
InvestorRelations@dendreon.com
 
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