The cost-cutting campaign continues for struggling biotech company Dendreon (NASDAQ: DNDN), which reported a narrower third-quarter loss before the opening bell today.
For the quarter, Dendreon, which makes metastatic prostate cancer immunotherapy vaccine Provenge, reported product revenue of $68 million, a 12.8% decline from the previous year, as its net loss shrank dramatically to just $67.2 million from $154.9 million in the year-ago period.
The dip in Provenge revenue shouldn't come as a major surprise as Dendreon warned earlier in the year that full-year revenue would decline due to tougher competition. Dendreon will be looking to change that moving forward because, as it notes in its press release, it received market authorization to sell Provenge in the EU.
Dendreon's narrower loss of $0.44 per share, which was still wider than Wall Street expected by $0.01, was fueled by cost-cutting across the board. Product revenue expenses were down 9.3%, research and development costs dipped 5.7%, and selling and administrative expenses fell 17.5%. It also helped that it recognized just minimal restructuring expenses this quarter compared to the $81 million it recognized at this time last year.
The company also ended the quarter with $233.3 million in cash and cash equivalents, down from $429.8 million in the year-ago period. Cash burn is an important statistic to monitor for biotech companies operating in the red as a low figure could mean the need to turn to dilutive share offerings to boost their cash levels.
Looking ahead, Dendreon plans to continue to move toward profitability by shrinking its spending. It announced another restructuring plan with a goal of saving $125 million annually which will come from all the aforementioned expenses areas above and is going to result in more layoffs, with the company projecting just 820 employees will remain when all is said and done, down from its peak of more than 2,000. It curently has 1,050 full-time employees, according to Yahoo! Finance.