Dendreon Corporation (NASDAQ:DNDN) today reported results for the third quarter ended September 30, 2011. The Seattle based company continues to lose money as it brings its flagship prostate cancer drug to market. One of the company’s three manufacturing facilities is located in Seal Beach.
In September the Company announced the layoff of 500 staffers nationally, of which 72 were in Seal Beach. The third quarter numbers reported today continue the flow of red ink and the company continues to burn through its cash reserves.
Dendreon Reported today it used cash of approximately $106 million during the three months ending September 30, 2011. As of that date, The Company had $568 million in the bank to fund operations until sales pick up enough to cover expenses and start making money.
Dendreon said it needs revenue of about $500 million to break even on a cash basis. Even though its revenue for the third quarter was only $64.3 million, and no additional external financings are planned, the company indicated it does not plan to close any plants or layoff more workers.
Dendreon said about 85% of next year’s costs should not increase as sales and revenues expand, and that’s how it expects to start generating cash. The Company said it is “using a very small portion of [manufacturing] capability,” suggesting that as sales pick up, costs will not increase at the same rate.
Dendreon said it expects “modest” quarter over quarter revenue growth to continue into the fourth quarter and beyond. With the September staff reductions completed, no other major restructurings are planned. The Company indicated a plant shutdown, while a potential option, was not anticipated. Since they expect to need the plant eventually, the cost of shuttering the plant and then restarting it later, make a closing unviable.
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About Dolores Barr, Publisher
Dolores Barr has lived in Rossmoor since 1992 and has created this site to provide local news for the people of Los Alamitos, Seal Beach, Rossmoor, Leisure World, Sunset Beach, and Surfside, California. My husband and I have had two students graduate from the Los Alamitos Unified School District and currently our Grandson, Ricky Apodaca, grade 3 at Weaver Elementary, is actively involved in youth baseball through LAYB and youth football through FNL.
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