Dendreon Reports Third Quarter 2008 Financial Results

The net loss for the quarter ended September 30, 2008 was $26.8 million, or $0.29 per share, compared to a net loss of $19.2 million, or $0.23 per share, for the quarter ended September 30, 2007. The net loss for the nine months ended September 30, 2008 was $62.8 million, or $0.71 per share, compared to $72.3 million, or $0.88 per share for the nine months ended September 30, 2007. Included in our net loss for the three and nine months ended September 30, 2008 was a non-cash charge of $9.1 million and $6.8 million, respectively, to other expense. This represents an increase in the fair value of the warrants issued in connection with our April 3, 2008 common stock offering, which has been recorded as a liability.

Cash, cash equivalents and short-term and long-term investments at September 30, 2008 totaled $106.6 million compared to $120.6 million at December 31, 2007. Additionally, subsequent to September 30, 2008, the Company received net proceeds of $19.8 million relating to a draw down on the Company's equity line of credit with Azimuth Opportunity Ltd.

    Recent Highlights:

    *    Completed the planned interim analysis of the Phase 3, randomized,
         double-blind, placebo-controlled IMPACT (IMmunotherapy for Prostate
         AdenoCarcinoma Treatment, also known as D9902B) clinical trial
         designed to assess the safety and efficacy of the investigational
         active cellular immunotherapy PROVENGE(R) (sipuleucel-T) in men with
         metastatic androgen-independent prostate cancer.  While Dendreon
         remains blinded to the data, the independent data monitoring
         committee (IDMC) reported to Dendreon a 20 percent reduction in the
         risk of death in the PROVENGE arm relative to placebo (Hazard
         Ratio= 0.80; 95% Confidence Interval [0.610-1.051]).  The IDMC
         observed no safety concerns and recommended that the study continue
         to its final analysis, which is expected to be completed in mid-2009.
    *    Presented preclinical data on the Company's lead small molecule
         candidate, D-3263, which targets Trp-p8 (a transmembrane cation
         channel protein also known as Trp-M8), supporting Trp-p8 as a
         therapeutic cancer target. Dendreon plans to file an Investigational
         New Drug (IND) application later this year with the U.S. Food and
         Drug Administration (FDA) to evaluate D-3263 in a Phase 1 dose
         escalation study in cancer.
    *    Initiated a Phase 2 trial of PROVENGE called ProACT (PROstate Active
         Cellular Therapy) or P07-2.  The multicenter trial is enrolling 120
         patients with metastatic, androgen independent prostate cancer.
    *    Initiated a Phase 2 trial of PROVENGE in men with localized prostate
         cancer who are scheduled to undergo a radical prostatectomy.  The
         single-center trial called NeoACT (NEOadjuvant Active Cellular
         immunoTherapy), or P07-1, which is being conducted at UCSF Helen
         Diller Family Comprehensive Cancer Center, is enrolling
         approximately 40 patients.
    *    In lieu of Dendreon's regularly scheduled quarterly conference call,
         the Company will present at two upcoming investor conferences that
         will be webcast.  Both conferences will occur later this month and
         include:
              o    Rodman & Renshaw 10th Annual Healthcare Conference
              o    Lazard Capital Markets 5th Annual Healthcare Conference

"The interim analysis of our Phase 3 IMPACT trial was an important milestone for us. We were encouraged to see a 20 percent reduction in the risk of death in the PROVENGE arm versus placebo at the time of this analysis in a patient population that currently has few appealing treatment options available," stated Mitchell H. Gold, M.D., president and chief executive officer of Dendreon Corporation. "Importantly, the results from this interim analysis are consistent with those from our previous Phase 3 studies at a similar follow-up time, and we are looking forward to the final analysis of the IMPACT trial in the middle of next year."

About Dendreon

Dendreon Corporation is a biotechnology company whose mission is to target cancer and transform lives through the discovery, development and commercialization of novel therapeutics. The Company applies its expertise in antigen identification, engineering and cell processing to produce active cellular immunotherapy product candidates designed to stimulate an immune response. Dendreon is also developing an orally-available small molecule that targets Trp-p8 that could be applicable to multiple types of cancer as well as benign prostatic hyperplasia. The Company has its headquarters in Seattle, Washington and is traded on the Nasdaq Global Market under the symbol DNDN. For more information about the Company and its programs, visit http://www.dendreon.com.

Except for historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties surrounding the efficacy of PROVENGE to treat men suffering from prostate cancer, risks and uncertainties surrounding the presentation of data to the FDA and approval of product applications by the FDA and risks and uncertainties inherent in the process of discovering, developing and commercializing drugs that are safe and effective for use as human therapeutics. Factors that may cause such differences include risks related to our limited operating history, risks associated with completing our clinical trials, the risk that the safety and/or efficacy results of existing clinical trials or from additional clinical trials for PROVENGE will not support approval for a biologics license, the risk that the FDA may interpret data differently than we do or require more data or a more rigorous analysis of data than expected, the risk that the FDA will not approve a product for which a biologics license has been applied, the risk that the results of a clinical trial for PROVENGE or other product may not be indicative of results obtained in a later clinical trial, risks that we may lack the financial resources and access to capital to fund required clinical trials or commercialization of PROVENGE, our dependence on the efforts of third parties, and our dependence on intellectual property. Further information on the factors and risks that could affect Dendreon's business, financial condition and results of operations are contained in Dendreon's public disclosure filings with the U.S. Securities and Exchange Commission, which are available at http://www.sec.gov.



                             DENDREON CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                   (in thousands, except per share amounts)

                                        Three months ended  Nine months ended
                                           September 30,       September 30,
                                          2008      2007      2008      2007

    Revenue                                 $26      $112       $83      $715

    Operating expenses:
        Research and development         12,660    13,449    39,331    54,780
        General and administrative        4,625     6,364    15,720    20,458
    Total operating expenses             17,285    19,813    55,051    75,238
    Loss from operations                (17,259)  (19,701)  (54,968)  (74,523)
    Interest income                         819     2,022     2,907     4,744
    Interest expense                     (1,218)   (1,551)   (3,995)   (2,534)
    Loss from valuation of warrant
     liability                           (9,119)      -      (6,751)      -
    Net loss                           $(26,777) $(19,230) $(62,807) $(72,313)


    Basic and diluted net loss per
     share                               $(0.29)   $(0.23)   $(0.71)   $(0.88)

    Shares used in computation of basic
     and diluted net loss per share      91,723    82,965    88,762    82,356



                                      September 30,   December 31,
                                          2008            2007
    Balance Sheet Data:
    Cash and cash equivalents           $61,839         $75,721
    Short-term investments               35,654          27,115
    Long-term investments                 9,077          17,739
    Total assets                        145,144         161,662
    Warrant liability                    21,313             -
    Convertible senior subordinated
     notes                               85,250          85,250
    Total stockholders' equity           13,579          40,377

SOURCE Dendreon Corporation