FDA Approves First Drug for Exelixis of South San Francisco

11/29/12Follow @Tansey_Xconomy

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subset of thyroid gland cells, called C cells. The disease makes up about 4 percent of thyroid cancer cases, the cancer society estimates.

AstraZeneca, whose drug vandetanib (Caprelsa) was approved for medullary thyroid cancer in 2011, earned revenues of $19 million from the product during the first nine months of 2012, the company said in an earnings press release.

Exelixis estimates that the population of thyroid cancer patients who would benefit from the drug is 500 to 700 people in US, and about the same for Europe.

Exelixis faces higher hurdles in prostate cancer than it did in its thyroid cancer program. If cabozantinib were eventually approved as a prostate cancer treatment, it would enter an increasingly competitive field. New drugs for late-stage prostate cancer include enzalutamide (Xtandi), developed by Medivation of San Francisco and Astellas Pharma; Johnson & Johnson’s abiraterone (Zytiga); and the cancer vaccine sipuleucel-T (Provenge).

In Exelixis’s COMET-1 trial in late-stage prostate cancer, the company hopes to prove that subjects on cabozantinib have an improved overall survival—that is, they live longer. In the COMET-2 trial, Exelixis hopes to show that cabozantinib reduces pain in subjects whose prostate cancer has spread to their bones.

Morrissey says Exelixis has enough cash to fund its own operations, including the two prostate cancer trials, into 2014. He says the company may also start a trial in another cancer type, such as liver or kidney cancer, in 2013.

In August, Exelixis raised $416.1 million by selling 30 million shares and issuing convertible notes. The company ended the third quarter with $674.7 million in cash, marketable securities, and short-term and long-term investments. But the company also faces a series of debt repayments.

Morrissey says Exelixis would consider teaming up with a partner to develop cabozantinib.

“We would be open to the right deal at the right time at the right terms,’’ Morrissey said earlier this month. “Doing it by ourselves is the overall default decision.’’

In the meantime, Exelixis depends on occasional revenues from milestone payments that may flow from drug development partnerships with Sanofi, Bristol-Myers Squibb, and other companies.

Exelixis shares are trading lower than their 52-week high of $6.95, though the price rose modestly in the past two weeks to close at $5.28 on Nov. 28, the eve of the FDA decision date. In intraday trading after the FDA announcement, the shares were trading down slightly at $5.24.

Bernadette Tansey is Xconomy's San Francisco Editor. You can reach her at btansey@xconomy.com. Follow @Tansey_Xconomy

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