analyst David Nierengarten reiterated an Underperform rating and $1 price target on Dendreon (NASDAQ: DNDN) after the CHMP recommended that the European Medicines Agency (EMA) grant approval to Provenge for asymptomatic/minimally symptomatic prostate cancer patients.
While the EMA is likely to grant approval, Nierengarten asks "who's going to make it?"
The analyst notes management has stated many times that the company would try to find a partner to manufacture Provenge in the EU. "We find it indicative of the company's difficulties in manufacturing Provenge with an acceptable profit margin that no European manufacturer has stepped up yet to work with Dendreon," he said.
If they do find a manufacturer, they find it unlikely that the company would garner a meaningful level of Provenge sales in the EU countries. Adding in the share to a partner, it makes it even less likely that the company would have meaningful profits in the area.
"All-in, we do not estimate any sales for Provenge in the EU, and we do not believe the European opportunity, if there is one, would be profitable in any significance," the analyst concluded.