Dendreon Corporation: Strategies for International Growth

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Dendreon Corporation: Strategies for International Growth

Amy R. Herl

Chadron State College

Executive Summary

Dendreon Corporation faces tremendous potential with expansion into the Chinese market. The company is positioned for great expansion, just having received it Food and Drug Administration approval for its first drug, Provenge. The drug has wide-spread potential in the Chinese market that promises increasing life expectancy, rapidly growing disposable incomes, improving healthcare infrastructure, and evolving patent protection. When the possibility of a strategic alliance with the only pharmaceutical company currently based in Asia, Takeda, is considered, the potential for success in the Chinese market is even more promising. The drug market in developing countries, such as China, is growing exponentially when compared to its growth in developed markets and by entering the Chinese market Dendreon will strategically position itself for further penetration of other rapidly growing, under-penetrated international markets. I hope Dendreon’s senior management will consider the following presentation on why the Chinese market should be a priority in the company’s future expansion.

Dendreon Corporation: International Growth


Having just received Food and Drug Administration approval for its first drug, Dendreon faces the promise of great success. Beyond the traditional pharmaceutical markets in the United States and Europe lies the developing world. The growth in drug demand in these countries is exponentially greater than in developed countries, and if Dendreon carefully selects a well-positioned international market to enter, the sky will be the limit for future success. In the following sections I will present a potential international market, China, and will demonstrate why and how Dendreon can enter this market to ensure long-term growth and success.

Company profile

Dendreon Corporation is a bio-technology company focused on targeting cancer. The company is headquartered in Seattle, Washington, and has manufacturing facilities in New Jersey. The company recently received Food and Drug Administration (FDA) approval for its first drug, Provenge, an active cellular immunotherapy (ACI) medication for the treatment of prostate cancer. Active cellular immunotherapy (ACI) uses a patient’s own cells to stimulate an immune response against cancer. The company seeks to develop medications that fight cancer, particularly through the use of antigen identification, engineering, and cell processing to produce active cellular immunotherapy ("Dendreon: about us," 2010).

With the recent FDA approval of Provenge, the company is on the horizon of exponential growth. Currently, Dendreon is constructing additional production facilities in California and Georgia, and has entered into a marketing authorization application with a German manufacturer to produce Provenge in Europe while the company awaits approval to commence construction of its own production facility in Germany (Taylor, 2011).

While these growth strategies may seem bold for just one drug, Dendreon has good reason for expansion in the short-term. Provenge sales were $48 million but are expected to reach $350 to $400 million in 2011. The company’s New Jersey production facility is expected to reach full capacity by the end of the first quarter of 2011. In addition to the need for increased production capability is the logistical aspect of manufacturing and delivering a drug with limited shelf life. Provenge must be manufactured near the patients that will receive it because it can not be transported over long distances (Feuerstein, 2011).

Despite the bright outlook for Provenge in the near term, the company must remain vigilant for new growth opportunities if it hopes to be successful in the long-term. In order to succeed in the long term, Dendreon must look for additional opportunities for growth and must...
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