Yesterday, Rule Breakers pick Exelixis (NASDAQ:EXEL) announced its second-quarter financial results. Despite not having its lead drug chosen for development by partner GlaxoSmithKline (NYSE:GSK), Exelixis is heading in the right direction with its drug pipeline.

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 (NASDAQ:SGEN) or other drugmakers, typically bring in millions of dollars in upfront cash, which Exelixis could certainly use to help fill up its $250 million cash and investments stockpile.

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 (NYSE:DNA) and other big pharma partners, like Bristol-Myers Squibb (NYSE:BMY) and Wyeth (NYSE:WYE), for its early-stage pipeline and preclinical stage work.

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.

Exelis is a Rule Breakers selection. You can check out all our recommendations as well as get access to our message boards and exclusive content with a 30-day free trial.

Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy.