Deutsche Bank (DB) analyst Robyn Karnauskas downgraded his rating on shares of Dendreon Corp. (NASDAQ:DNDN) to "Hold" from "Buy", saying there is no reason to accumulate shares in the near term due to sales force disruption.
Karnauskas, who reduced price target on the stock to $7 from $18, is moving to the sidelines due to gaps in the sales force, which the analyst says will delay growth of prostate cancer drug Provenge.
"Q2 results & restructuring were not too far from expectations. However, the surprise this quarter was 18 percent of accounts were not covered by sales due to reps leaving to other biotechs focused on oncology," the analyst wrote.
"We find this concerning but expect sales rebound as Dendreon plugs gaps in sales force. However, we do not see rebound until H1:13," Karnauskas wrote. "If the sales force stabilizes, we may revisit our view." The analyst lowered his Provenge peak sales estimate to $600 million.
Seattle, Washington-based Dendreon's product portfolio include active cellular immunotherapy and small molecule product candidates to treat a range of cancers.
The stock, which has been trading in the 52-week range of $4.75 to $37.72, is trading 22.82 percent lower at $4.76 on Tuesday.