Zytiga Threatens Provenge's Market Share

Laura Joszt

In the last year, Zytiga has slowly been eating away at Provenge's target market while Provenge sales stagnate.

Since it first hit the market, Dendreon’s sipuleucal-T (Provenge) has had a tough time, and Johnson & Johnson’s rival drug, abiraterone (Zytiga) has only made things worse. In the last year, Zytiga has slowly been eating away at Provenge’s target market.

After Provenge was approved by the FDA in 2010, Dendreon had to face its own limited manufacturing capacity and concerns by physicians about being reimbursed for the $93,000 treatment. In 2011 Provenge’s sales fell far short, only raking in $213 million for Dendreon instead of the $350 million to $400 million forecasted.

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Now there’s the threat from Zytiga. While Provenge is for prostate cancer patients whose disease has worsened after chemical castration treatment, but who haven’t undergone chemotherapy yet, Zytiga is approved for use after chemotherapy fails*. However, according to a article, physicians have prescribed J&J’s Zytiga “off-label” for patients in earlier stages of the disease.

Zytiga’s market share has been steadily growing while Provenge has stagnated. In July 2011, Zytiga had 6% of the target population, but that has increased to 12 in November and 18% in March.

As a result the average analyst rating for Dendreon’s stock is “hold.” Investment firm Robert W. Baird recently released a report rating the stock “neutral” with a price target of $13. On Monday afternoon, Dendreon’s stock was $11.99.

Baird also surveyed 100 community-based medical oncologists in March, with only 41% reporting that their practice uses Provenge. That’s slightly down from 42% in November.

The information contained in this article should not be construed as investment advice or as a solicitation to buy or sell any stock.

Dendreon will release its Q1 earnings report Monday after the market closes, but the company itself has forecasted only a moderated sales growth.

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*Corrected statement on when Zytiga is approved for use.