Dendreon Pharmaceuticals LLC is emerging from last year’s sale, its second in three years, stronger than ever, with near-term international expansion in sight. Chief Executive James “Jim” Caggiano said its parent company, Nanjing-based Chinese conglomerate Sanpower Group Co. Ltd., will set up manufacturing facilities in Hong Kong and China.
“Sanpower is focused on bringing Provenge to China,” he said, adding that Sanpower is working with the China Food and Drug Administration to get the therapy approved. Provenge is Dendreon’s immune-oncology drug designed to treat patients with prostate cancer. It received U.S. FDA approval in 2010, then the first commercially available immunotherapy product.
Caggiano said Sanpower stayed true to its promise of leaving him to run U.S. operations when the Chinese firm bought the company last year for $819.9 million.
Dendreon generated $334 million in revenue last year and projects it will exceed $360 million this year, according to Caggiano. It announced in May that it will begin a clinical trial evaluating the effectiveness of Provenge in reducing disease progression in men with prostate cancer being managed by active surveillance.
Domestic Growth
Dendreon operates out of its 180,000-square-foot Seal Beach headquarters. It has 152,000-square-foot manufacturing facility in Union City, Ga. as well as a facility in Seattle, Wash. that houses medical and transportation and logistics operations. In a year, the company’s grown employee count from 500 to 650, about 190 based in Orange County.
Caggiano said growth was partially driven by Dendreon’s new strategy, which focuses marketing efforts around urologists rather than oncologists.
“The [original] marketing strategy was misguided—teaching oncologists how to [administer the therapy] and teaching urologists how to refer patients [with prostate cancer] to oncologists,” he said. Calling urologists “the quarterback” of prostate-cancer care, he said Provenge prescriptions that came from urologists now make up more than 56% of revenue, up from 25% in 2014.
Its next move is to enter clinical trials to support patients using its product at an earlier stage. Nearly 165,000 men are diagnosed with prostate cancer every year, according to statistics from the American Cancer Society.
Approximately 30% to 40% of the population opt for active surveillance, which includes regular monitoring to ensure the cancer is not growing or spreading, instead of going into more aggressive treatment options, like surgery and radiation, according to a study by Baltimore, Md.-based Johns Hopkins Medicine.
“If we can use Provenge in a much earlier stage of prostate cancer, then maybe we can keep these patients in the [active surveillance] group for longer, and even forever,” Caggiano said.
Provenge is currently approved for the treatment of minimally symptomatic, metastatic prostate cancer—a later stage of the disease.
The clinical trial will enroll 450 men age 18 or older. Study enrollment is scheduled to begin this year, followed by topline results in 2023.
China Market
Seattle-based Dendreon filed for Chapter 11 bankruptcy in the fall of 2014 amid disappointing sales and problems with insurance coverage. It was acquired by Valeant Pharmaceuticals International Inc. in 2015 for $495 million, fresh off its losing hostile bid for Allergan, then resold by Valeant to Sanpower two years later.
Last summer Dendreon emerged as a stand-alone subsidiary based in Seal Beach, and in a more favorable position to compete and expand.
“Dendreon brings unique strategic value to our portfolio,” said Sanpower Chairman Yuan Yafei in a company press release at the time of the purchase. Sanpower’s been acquiring healthcare assets in recent years, including senior care company Natali in Tel Aviv, Israel, New York Stock Exchange-listed China Cord Blood Corp. in Hong Kong—the largest cord blood bank in the world, according to Sanpower—and several hospitals, but Dendreon is Sanpower’s first precision medicine purchase.
Yuan said Sanpower looks to be a leader in stem cells and immune-oncology. Caggiano said Sanpower’s actively searching to buy other assets to join that portfolio.
Sanpower, formed in 1993, invests in finance, retail, information services, medical services and healthcare, and real estate. It has 100,000 employees and more than 100 subsidiaries, including iconic U.S.-based retailer Brookstone. It announced, along with China CITIC Bank, the formation of an approximately $2.9 billion healthcare industry M&A fund last year. The firms said the fund will support Sanpower’s continued push into healthcare.
Caggiano said that while Sanpower holds worldwide rights to Provenge, the investment company has maintained a hands-off policy on Dendreon’s U.S. operations. “The ultimate vision is that I will be CEO of Dendreon U.S., and once Provenge is approved in China, maybe there will be a Dendreon Asia CEO,” he said.
He joined Valeant in 2015 as senior vice president and general manager, and most recently served as president of Dendreon. He was promoted to chief executive in conjunction with the Sanpower sale.
Prior to rejoining Dendreon—he initially joined in 2004 as vice president of sales and marketing—he served as vice president of health sales and marketing for Allergan Medical, a division of Allergan.
About Therapy
Provenge is an immuno-oncology drug designed to stimulate a person’s immune system against cancer. The product is made from the patient’s own immune cells—white blood cells are extracted, blended with a protein intended to stimulate and direct them to fight against prostate cancer, then infused back into the patient as a vaccine. The therapy is administered in three doses, with one to two weeks in-between each dose. A full treatment course costs $93,000, according to published reports.
