When it comes to drug launches, it's all relative.
Granted, Dendreon is farther into its launch, but this is really about expectations. Optimer has a market cap of $600 million. Investors aren't expecting all that much out of Dificid; consensus revenue estimates were $1.8 million according to Optimer's PR firm. Dendreon was expected to approach $200 million in the fourth quarter, clearly unattainable from $50 million in the second quarter.
Dificid's biggest road block is that doctors have been using ViroPharma's
Is the better-than-expected launch a sign of better-than-expected peak sales, the true valuation metric for long-term investors? It's hard to say. The sales number that Optimer reported includes stocking orders, so either demand is really there or pharmacies thought there would be demand and ordered more than expected but it's just sitting on the shelves.
One bit of news that suggests it might be more of the former than the latter: For the week ending Sept. 2, 39% of hospital orders were repeat order, so at least in some hospitals, the doctors are using up the initial supply.
Sales for the fourth quarter will be the true test of how well the launch is going. Unfortunately for Optimer, investors may have adjusted their expectations after hearing yesterday's news, so it may be harder to get another solid jump in stock price. It's all about expectations.
And while you're waiting to see how Dificid performs, read about "5 Stocks The Motley Fool Owns -- And You Should Too."
Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Dendreon. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.