Yesterday, Rule Breakers pick Exelixis
Last month GSK chose not to pick up development of Exelixis' top oncology drug candidate, XL647. I don't agree that this was "the best possible outcome" as Exelixis' management proclaimed on the conference call yesterday, but neither should it be looked at as a solely negative event, either.
We'll have to see if an outside partnership with another drugmaker on XL647 will bring in the kind of dough that GSK would have been paying to have access to the drug. More data on the compound is expected to come in September. Cancer drugs at similar stages of development, such as those from Seattle Genetics
Exelixis is taking steps to defer some of the costs of its rather enormous fourteen-drug development pipeline. It is currently in discussions about potentially partnering its 100% owned drugs that GSK doesn't have the option of developing. Normally drugmakers that speak vaguely about partnership deals for early-stage compounds are pumping or unrealistically boasting, but Exelixis has credibility from its past lucrative development deals with Genentech
The rest of 2007 is going to be a busy time for Exelixis. The countdown on GSK decisions for two more of Exelixis' compounds are expected to begin ticking down this year with a third drug becoming eligible for GSK development in the first half of next year. In addition, Exelixis will be presenting numerous early-stage data on its compounds at a health care conference in late October, so investors will have plenty of data to look at in the second half of the year.