- Cabozantinib Franchise Net Product Revenue
of $88.0 million, Total Revenue of $99.0 million -
- Net Income of $17.7 million, Diluted EPS
of $0.06 per Share -
- Conference Call and Webcast Today at 5:00
PM Eastern Time -
Exelixis, Inc. (Nasdaq: EXEL) today reported financial results
for the second quarter of 2017 and provided an update on progress
toward fulfilling its key corporate objectives, as well as
commercial and clinical development milestones.
Exelixis is focused on maximizing the opportunity for its two
internally discovered compounds, cabozantinib and cobimetinib, to
improve care and outcomes for people with cancer around the world.
The company’s top priority remains the commercialization of
CABOMETYX® (cabozantinib) tablets as a treatment for patients with
advanced renal cell carcinoma (RCC) who have received prior
anti-angiogenic therapy. During the second quarter of 2017,
CABOMETYX generated $80.9 million in net product revenue, while
COMETRIQ® (cabozantinib) capsules for the treatment of patients
with progressive, metastatic medullary thyroid cancer generated an
additional $7.1 million in net product revenue, for a combined
$88.0 million in net product revenue for the cabozantinib
franchise.
While continuing to execute on the commercialization of
CABOMETYX, Exelixis made further progress this quarter on drivers
for the company’s future growth. Importantly, an analysis of
progression-free survival (PFS) based on the independent radiology
review committee (IRC) review of radiographic images from the
CABOSUN trial confirmed results per investigator assessment
reported earlier. The IRC review was conducted in support of a
supplemental New Drug Application (sNDA) filing for cabozantinib as
a treatment for patients with previously untreated advanced RCC
planned for submission in the third quarter of 2017. In addition,
several new trials combining cabozantinib with leading
immunotherapies were recently initiated in genitourinary cancer
indications. The company also retired the final tranche of its
remaining corporate debt, and shortly after the close of the second
quarter, announced the favorable settlement of its dispute with
Genentech (a member of the Roche Group) concerning cobimetinib,
which Exelixis initiated in June 2016.
“The second quarter of 2017 was highlighted by the growth of the
cabozantinib franchise, and the significant clinical development,
financial and regulatory progress made by the Exelixis team,” said
Michael M. Morrissey, Ph.D., President and Chief Executive Officer
of Exelixis. “With increasing revenues and disciplined financial
management, Exelixis is now funding our growth from our operations,
giving us the flexibility to invest in clinical trials, evaluate
business development opportunities, and reinitiate measured
discovery operations that can build long-term value and benefit the
patients we serve.”
Dr. Morrissey continued: “Shortly after the quarter closed,
Exelixis made an important step forward when we and our partner
Genentech agreed to a revised revenue and cost-sharing arrangement
for cobimetinib’s commercialization in the United States. The new
terms provide an equitable foundation for our work with Genentech
on this important Exelixis-discovered compound that is now the
subject of three phase 3 pivotal trials and multiple earlier stage
trials.”
Cabozantinib Highlights
Strong Growth in Cabozantinib Franchise Net Revenue.
Cabozantinib generated $88.0 million in net product revenue during
the second quarter of 2017, an increase of 28 percent from the
first quarter of 2017 and an increase of 178 percent
year-over-year. The year-over-year increase was driven primarily by
the continued U.S. uptake of CABOMETYX following U.S. Food and Drug
Administration approval in April 2016 as a treatment for patients
with advanced RCC who have received prior anti-angiogenic
therapy.
Start of Phase 3 Trial of Cabozantinib in Combination with
Nivolumab or with Nivolumab and Ipilimumab in Previously Untreated
Advanced or Metastatic RCC. Shortly after the quarter ended,
Exelixis and Bristol-Myers Squibb Company (BMS) announced the
initiation of CheckMate 9ER, the phase 3 trial evaluating
cabozantinib in combination with two of BMS’ leading
immunotherapies, nivolumab and ipilimumab, compared to sunitinib.
The trial is planned to enroll 1,014 treatment-naïve patients, and
the primary endpoint is PFS.
Launch of Phase 1b Trial of Cabozantinib with Atezolizumab in
Patients with Locally Advanced or Metastatic Solid Tumors. In
June, Exelixis announced the initiation of the dose-escalation
stage of a phase 1b trial of cabozantinib in combination with
atezolizumab in patients with locally advanced or metastatic
urothelial carcinoma (UC) or RCC. The primary objective is to
determine the optimal dose and schedule of daily oral
administration of cabozantinib when given in combination with
atezolizumab to inform the trial’s subsequent expansion stage.
Expansion cohorts will evaluate the selected dose and schedule in
four settings, including previously untreated RCC patients,
previously untreated, both cisplatinum eligible and ineligible UC
patients, and previously treated UC patients.
Continued Progress on Filing in Previously Untreated Advanced
RCC. During the second quarter, Exelixis announced that the
analysis of the review by a blinded IRC had confirmed the primary
efficacy endpoint results of investigator-assessed PFS from the
CABOSUN randomized phase 2 trial in patients with previously
untreated advanced RCC with intermediate- or poor-risk disease. The
company remains on track to file its sNDA for cabozantinib in the
third quarter of 2017.
CELESTIAL Data Anticipated in the Second Half of 2017.
CELESTIAL, the ongoing phase 3 pivotal trial of cabozantinib in
patients with advanced hepatocellular carcinoma (HCC), continues to
progress. Exelixis is tracking events closely and continues to
anticipate that the second interim analysis at 75 percent of the
required events will be completed in the second half of 2017.
Cabozantinib and Cobimetinib Data Presentations at the ESMO
2017 Congress. Exelixis-discovered compounds will be the
subject of 10 presentations at the ESMO 2017 Congress, which is
being held September 8-12, 2017 in Madrid, Spain. Data from
CABOSUN, the randomized phase 2 trial of cabozantinib versus
sunitinib in patients with previously untreated advanced RCC, have
been accepted as a late-breaking abstract at the meeting and will
be the subject of a poster discussion on Sunday, September 10th.
Other cabozantinib presentations will include an oral presentation
of data from the phase 1b trial of cabozantinib, nivolumab, and
ipilimumab in advanced genitourinary malignancies, as well as
additional analyses of the METEOR trial in advanced RCC.
Cobimetinib presentations at the Congress will include two data
sets concerning forms of metastatic melanoma.
Cobimetinib Highlights
Settlement of Arbitration Between Exelixis and Genentech
Regarding Companies’ Collaboration Agreement for Cobimetinib.
After the quarter ended, Exelixis announced a settlement of our
arbitration with Genentech concerning claims asserted by
Exelixis against Genentech related to the development and
commercialization of cobimetinib, the Exelixis-discovered medicine
that is marketed as COTELLIC®. The revised revenue and cost-sharing
arrangement resolves the companies’ dispute pursuant to the
arbitration demand filed on June 3, 2016, and aligns both
companies’ interests in advancing cobimetinib as a promising
therapy for patients with multiple forms of cancer. Moving forward,
the revenue applied to the profit and loss statement for the
COTELLIC collaboration (Collaboration P&L) will now be
calculated using the average of the quarterly net selling prices of
COTELLIC and any additional branded Genentech product(s) prescribed
with COTELLIC. Exelixis will continue to share U.S.
commercialization costs, while Genentech’s portion of these costs
will now be allocated to the Collaboration P&L in proportion to
the number of Genentech products in any given combination including
COTELLIC. For more detail on the terms, please see Exelixis’ press
release and corresponding Form 8-K filed with the U.S. Securities
and Exchange Commission (SEC), both issued on July 20, 2017.
Cobimetinib Now the Subject of Three Phase 3 Pivotal
Trials. Roche recently confirmed it anticipates enrolling the
first patient in IMspire170, the phase 3 pivotal trial of
cobimetinib and atezolizumab versus pembrolizumab in first-line
BRAF wild-type metastatic or unresectable locally advanced
melanoma, in the third quarter of 2017. Alongside the fully
enrolled IMblaze370 trial (third-line advanced or metastatic
colorectal cancer) and the currently recruiting IMspire150 TRILOGY
(first-line BRAF V600 mutation-positive metastatic or unresectable
locally advanced melanoma), cobimetinib is now the subject of three
phase 3 pivotal trials where it is being evaluated in combination
with other anticancer therapies.
Corporate Highlights
Last Source of Indebtedness Retired Through Repayment of the
Deerfield Notes. In June 2017, Exelixis retired a series of
Secured Convertible Notes originally issued in July 2010 to
entities associated with Deerfield Management Company, L.P.
(Deerfield Notes). Exelixis retired the Deerfield Notes by making a
$123.8 million payment to the Deerfield entities. Repaying the
Deerfield Notes a year ahead of their July 2018 maturity date will
save Exelixis approximately $12 million in interest expense.
Significant Presence for Cabozantinib and Cobimetinib at the
2017 ASCO Annual Meeting. Exelixis-discovered compounds were
the subject of 13 presentations, including further analysis of the
METEOR study in advanced RCC, as well as updated results from the
phase 1b combination trial of cabozantinib plus immunotherapy in
genitourinary tumors. Additional cabozantinib data presentations
included results from trials in endometrial cancer and uterine
carcinosarcoma. Cobimetinib data included updates from the early
stage combination trials of cobimetinib plus atezolizumab, and plus
atezolizumab and vemurafenib, which have informed the design of
several of Roche’s ongoing phase 3 pivotal trials.
2017 Financial Guidance
The company is reiterating its previously provided guidance that
total costs and operating expenses for the full year will be
between $290 million and $310 million. This guidance includes
approximately $25 million of non-cash costs and expenses related
primarily to stock-based compensation expense.
Second Quarter 2017 Financial
Results
Total revenue for the quarter ended June 30, 2017
was $99.0 million, compared to $36.3 million for the comparable
period in 2016. Total revenue includes $88.0 million and $11.0
million of net product revenue and collaboration revenue,
respectively, compared to $31.6 million and $4.6 million for the
comparable period in 2016. The increase in net product revenues
primarily reflects the impact of the commercial launch of CABOMETYX
in late April 2016. Collaboration revenues for the quarter ended
June 30, 2017 include $5.5 million, $4.1 million and $1.4
million earned under our collaboration agreements with Ipsen,
Takeda and Genentech, respectively. In comparison, during the
quarter ended June 30, 2016, collaboration revenues include
$3.6 million and $1.0 million earned under our collaboration
agreements with Ipsen and Genentech, respectively.
Research and development expenses for the quarter ended
June 30, 2017 were $28.2 million, compared to $23.0 million
for the comparable period in 2016. The increase in research and
development expenses was primarily a result of increases in
clinical trial costs and personnel expenses. The clinical trial
cost increase was predominantly due to increases in costs related
to CABOSUN, start-up costs associated with CheckMate 9ER, and
start-up costs associated with Exelixis’ phase 1b trial of
cabozantinib and atezolizumab in locally advanced or metastatic
solid tumors, and were partially offset by a decrease in costs
related to METEOR. The increase in personnel-related expenses was
primarily a result of an increase in headcount associated with the
re-launch of our discovery program and the build-out of our medical
affairs organization.
Selling, general and administrative expenses for the
quarter ended June 30, 2017 were $40.7 million, compared to
$35.8 million for the comparable period in 2016. The increase in
selling, general and administrative expenses was primarily a result
of increases in personnel expenses resulting primarily from an
increase in headcount connected with the build-out and support of
the Exelixis U.S. commercial organization, an increase in legal
costs, and an increase in consulting and outside services to
support our marketing activities. Those increases were partially
offset by a decrease in losses under the collaboration agreement
with Genentech driven by Genentech’s change in cost allocation
approach in January 2017.
Other expense, net for the quarter ended June 30,
2017 was a net expense of $8.9 million, compared to $9.7 million
for the comparable period in 2016. The decrease in other expense,
net, was primarily due to a decrease in interest expense as a
result of the 2016 conversions and redemption of the 4.25%
Convertible Subordinated Notes due 2019 and the repayment of the
Silicon Valley Bank term loan in March 2017. The decrease in
interest expense was partially offset by a $6.2 million loss on
extinguishment primarily related to the prepayment penalty
associated with the early repayment of the Deerfield Notes on June
28, 2017.
Net income for the quarter ended June 30, 2017 was
$17.7 million, or $0.06 per share, basic and diluted, compared to a
net loss of $(34.8) million, or $(0.15) per share, basic and
diluted, for the comparable period in 2016. The decrease in net
loss was primarily due to the increase in net product and
collaboration revenues, partially offset by the increase in
operating expenses.
Cash and cash equivalents, short- and long-term
investments and long-term restricted cash and investments totaled
$380.3 million at June 30, 2017, as compared to $479.6 million
at December 31, 2016.
Basis of Presentation
Exelixis adopted a 52- or 53-week fiscal year that generally
ends on the Friday closest to December 31st. For convenience,
references in this press release as of and for the fiscal periods
ended June 30, 2017, December 30, 2016 and July 1, 2016
are indicated as being as of and for the periods ended June
30, 2017, December 31, 2016 and June 30 , 2016, respectively.
Conference Call and
Webcast
Exelixis management will discuss the company’s financial results
for the second quarter of 2017 and provide a general business
update during a conference call beginning at 5:00 p.m. EDT/2:00
p.m. PDT today, Wednesday, August 2, 2017.
To access the webcast link, log onto www.exelixis.com and proceed to the Event Calendar
page under Investors & Media. Please connect to the company’s
website at least 15 minutes prior to the conference call to ensure
adequate time for any software download that may be required to
listen to the webcast. Alternatively, please call (855) 793-2457
(domestic) or (631) 485-4921 (international) and provide the
conference call passcode 49002905 to join by phone.
A telephone replay will be available until 11:59 p.m. EDT on
Friday, August 4, 2017. Access numbers for the telephone replay
are: (855) 859-2056 (domestic) and (404) 537-3406 (international);
the passcode is 49002905. A webcast replay will also be archived
on www.exelixis.com for one
year.
About Exelixis
Exelixis, Inc. (Nasdaq: EXEL) is a biopharmaceutical company
committed to the discovery, development and commercialization of
new medicines to improve care and outcomes for people with cancer.
Since its founding in 1994, three products discovered at Exelixis
have progressed through clinical development, received regulatory
approval, and entered the marketplace. Two are derived from
cabozantinib, an inhibitor of multiple tyrosine kinases including
VEGF, MET, AXL and RET receptors: CABOMETYX® tablets approved for
previously treated advanced renal cell carcinoma and COMETRIQ®
capsules approved for progressive, metastatic medullary thyroid
cancer. The third product, COTELLIC®, is a formulation of
cobimetinib, a reversible inhibitor of MEK, is marketed under a
collaboration with Genentech (a member of the Roche Group), and is
approved as part of a combination regimen to treat advanced
melanoma. Both cabozantinib and cobimetinib have shown potential in
a variety of forms of cancer and are the subjects of broad clinical
development programs. For more information about Exelixis, please
visit www.exelixis.com or follow
@ExelixisInc on Twitter.
Forward-Looking
Statements
This press release contains forward-looking statements,
including, without limitation, statements related to: Exelixis’
focus on maximizing the opportunity for cabozantinib and
cobimetinib to help patients with cancer around the world; the
commercialization of CABOMETYX as Exelixis’ top priority; the
drivers for Exelixis’ future growth; Exelixis’ plan to submit a
sNDA in the third quarter of 2017 for cabozantinib as a treatment
for previously untreated patients with advanced RCC; the
anticipated timing for the second interim analysis of CELESTIAL in
the second half of 2017; future data presentations from clinical
trials of cabozantinib and cobimetinib at the ESMO 2017 Congress;
the anticipated timing of enrollment for IMspire170; Exelixis’
guidance for 2017 total costs and operating expenses, including
non-cash costs and expenses; and the therapeutic potential and
continued development of cabozantinib and cobimetinib. Words such
as “focused,” “priority,” “future,” “planned,” “anticipated,”
“will,” “guidance,” “committed,” “potential,” or other similar
expressions identify forward-looking statements, but the absence of
these words does not necessarily mean that a statement is not
forward-looking. In addition, any statements that refer to
expectations, projections or other characterizations of future
events or circumstances are forward-looking statements. These
forward-looking statements are based upon Exelixis’ current plans,
assumptions, beliefs, expectations, estimates and projections.
Forward-looking statements involve risks and uncertainties. Actual
results and the timing of events could differ materially from those
anticipated in the forward-looking statements as a result of these
risks and uncertainties, which include, without limitation: the
degree of market acceptance of CABOMETYX, COMETRIQ, and COTELLIC
and the availability of coverage and reimbursement for these
products; the risk that unanticipated developments could adversely
affect the commercialization of CABOMETYX, COMETRIQ, and COTELLIC;
Exelixis’ dependence on its relationship with its
collaboration partners, including, the level of their investment in
the resources necessary to successfully commercialize cabozantinib
and cobimetinib in the territories where they are approved; risks
and uncertainties related to regulatory review and approval
processes and Exelixis’ compliance with applicable legal and
regulatory requirements; Exelixis’ ability and the ability of
its collaborators to conduct clinical trials of cabozantinib and
cobimetinib both alone and in combination with other therapies
sufficient to achieve a positive completion; risks related to the
potential failure of cabozantinib and cobimetinib, both alone and
in combination with other therapies, to demonstrate safety and
efficacy in clinical testing; the level of costs associated with
Exelixis’ commercialization, research and development and other
activities; Exelixis’ dependence on third-party vendors;
Exelixis’ ability to protect the company’s intellectual property
rights; market competition; changes in economic and business
conditions, and other factors discussed under the caption “Risk
Factors” in Exelixis’ quarterly report on Form 10-Q filed with
the SEC on May 1, 2017, and in Exelixis’ future filings
with the SEC, including, without limitation, Exelixis’
quarterly report on Form 10-Q expected to be filed with the SEC on
August 2, 2017. The forward-looking statements made in this press
release speak only as of the date of this press
release. Exelixis expressly disclaims any duty,
obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in Exelixis’ expectations with regard thereto or
any change in events, conditions or circumstances on which any such
statements are based.
Exelixis, the Exelixis logo, CABOMETYX, COMETRIQ and COTELLIC
are registered U.S. trademarks.
EXELIXIS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended June 30, Six Months Ended June
30, 2017 2016 2017
2016 Revenues: Net product revenues $ 88,004 $ 31,618 $
156,881 $ 40,717 Collaboration revenues 11,004 4,634
23,014 10,962 Total revenues 99,008 36,252
179,895 51,679 Operating expenses: Cost of
goods sold 3,014 1,560 6,217 2,245 Research and development 28,214
22,984 51,424 51,910 Selling, general and administrative 40,727
35,823 74,987 70,680 Restructuring (recovery) charge (60 ) 1,021
(32 ) 1,115 Total operating expenses 71,895
61,388 132,596 125,950 Income (loss) from
operations 27,113 (25,136 ) 47,299 (74,271 ) Other
expense, net: Interest income and other, net 1,622 749 2,690 951
Interest expense (4,259 ) (10,451 ) (8,679 ) (20,741 ) Loss on
extinguishment of debt (6,239 ) — (6,239 ) — Total
other expense, net (8,876 ) (9,702 ) (12,228 ) (19,790 ) Income
(loss) before income taxes 18,237 (34,838 ) 35,071 (94,061 ) Income
tax expense 581 — 715 — Net income
(loss) $ 17,656 $ (34,838 ) $ 34,356 $ (94,061 ) Net
income (loss) per share, basic $ 0.06 $ (0.15 ) $ 0.12 $ (0.41 )
Net income (loss) per share, diluted $ 0.06 $ (0.15 ) $ 0.11 $
(0.41 ) Shares used in computing basic net income (loss) per share
293,188 229,310 292,029 228,860 Shares used in computing diluted
net income (loss) per share 311,219 229,310 310,759 228,860
EXELIXIS, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
DATA
(in thousands)
(unaudited)
June 30, 2017
December 31,2016 (1)
Cash and investments (2) $ 380,319 $ 479,554 Working capital $
304,568 $ 200,215 Total assets $ 516,532 $ 595,739 Total
stockholders’ equity $ 148,511 $ 89,318
_______________________________________ (1) Derived from the
audited consolidated financial statements. (2) Cash and investments
include cash and cash equivalents, short- and long-term investments
and long-term restricted cash and investments. Long-term restricted
cash and investments totaled $4.7 million as of June 30, 2017 and
$4.2 million as of December 31, 2016.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170802006359/en/
Exelixis, Inc.Chris Senner, 650-837-7240Chief Financial
Officercsenner@exelixis.comSusan
Hubbard, 650-837-8194Executive Vice President, Public Affairs and
Investor Relationsshubbard@exelixis.com
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