It's taken the U.S. Food and Drug Administration some time, but it finally approved Dendreon's (DNDN) breakthrough prostate cancer vaccine -- the first in its class. And after so much anticipation, Dendreon shares soared 15% on the news, trading at $45.51, before they were halted. Trading resumed at 3:30 p.m., and the stock closed up $10.56, or 26.65% higher, at $50.18.

Provenge is a treatment for men with advanced prostate cancer. Unlike regular vaccines that are given to prevent disease, Provenge is given once the patient is sick. But just like a vaccine, it aims to train the patient's own immune system to attack the disease -- cancer.

Provenge is produced from a patient's own white blood cells. The cells are exposed to a protein that's found in most prostate cancers, linked to an immune-stimulating substance. It's then administered intravenously back to the patient in a three-dose schedule given at about two-week intervals.

Milder Reactions Than to Chemotherapy

Almost all of the patients who received Provenge had some type of mild to moderate adverse reaction, including chills, fatigue, fever, back pain, nausea, joint ache and headache, which were reportedly milder than reactions from chemotherapy. Serious adverse reactions, reported in approximately one quarter of the patients receiving Provenge, included some acute infusion reactions and stroke.

This whole week biotech and pharma followers have been anticipating the FDA's decision, mostly projecting that the FDA would indeed approve Provenge. They weren't disappointed as the drug regulators approved the new therapy Thursday for certain men with advanced prostate cancer that has spread to other parts of the body and that no longer responds to hormone blockers (the standard treatment).

The road here wasn't easy for Dendreon and many supporters in the prostate cancer community. There has been much turmoil and drama the past few years, including credibility issues of Dendreon management, a possibly failed pivotal trial and even a conspiracy theory, as bNet tells it. And with each such event or news, Dendreon shares rode the reactions up and down, although the general direction was definitely up: Dendreon's stock price nearly doubled last year.

Blockbuster Sales Potential

Dendreon said in a webcast this afternoon after the FDA approval that the cost of full course of treatment is $93,000 ($31,000 per infusion), making Provenge one of the more expensive drugs and much higher than the estimated $75,000 cost analysts had estimated.

Provenge certainly has blockbuster potential, with the company estimating annual sales of $1.2 billion to $2.5 billion. But the prospects for Provenge, if it proves to work well in advanced cases, may be much greater. There is certainly a chance Provenge could prove helpful in the earlier stage of the disease. Already, doctors have been discussing when to use the drug. Doctors can use the therapy for off-label uses, that is, for disorders the FDA hasn't explicitly approved it for.

The added indications or uses may significantly add to Provenge's revenue-generating prospects. And some market watchers are certain Dendreon will be bought out. Regardless, there's no question that with this approval Dendreon is poised for stellar growth and may soon join the ranks of the top biotechs in the world. For now, Dendreon will be able to supply Provenge for only 2,000 patients for the next 12 months. By the middle of next year, it expects its manufacturing facilities to produce at full capacity -- at least $1.2 billion worth of the drug.

27,000 Deaths a Year

Prostate cancer is the second-most-common type of cancer among men in the U.S., the FDA said, and usually occurs in older men. In 2009, an estimated 192,000 new cases were diagnosed, and about 27,000 men died from the disease, according to the National Cancer Institute. Since prostate cancer is generally slow-growing, and the patient usually dies of something else before the cancer gets bad enough to kill him, it's far from certain Provenge makes sense for most men in the earliest stages of the disease.

The effectiveness of Provenge was studied in 512 patients with metastatic hormone treatment refractory prostate cancer in a randomized, double-blind, placebo-controlled, multicenter trial. The study showed that Provenge increased three-year survival by 38% compared to placebo, extending overall survival by 4.1 months and reducing the risk of death by 22.5%.