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Exelixis (EXEL) Q3 Earnings call transcript Oct 29, 2024

Daily EarningsWednesday, Oct 30, 2024 3:15 pm ET

1min read

EXEL -- MRK --

In a recent earnings call, Exelixis showcased its robust financial performance and strategic direction for the future, highlighting its focus on cabozantinib and zanzalintinib, and the early-stage pipeline. With a positive outlook on the company's prospects, here are the key takeaways from the call.

Cabozantinib's Strong Performance and Future Outlook

Exelixis reported a successful third quarter, with cabozantinib maintaining its position as the leading TKI for RCC in the US. The company's financial performance was driven by the strength of the cabozantinib franchise, which has seen increased demand, new patient starts, and revenue growth. The market for oral therapies in neuroendocrine tumors is projected to almost double by 2030, and Exelixis is well-positioned to capture a significant portion of this market, pending regulatory approval.

Zanzalintinib: A Promising Opportunity for Mid- to Long-Term Growth

The collaboration with Merck on zanzalintinib is a significant milestone for Exelixis. With six ongoing and planned pivotal trials, the company anticipates significant revenue opportunities starting as early as 2026. The potential for zanzalintinib to surpass cabozantinib in scope and scale is a promising sign for Exelixis' long-term growth strategy.

Early-Stage Pipeline: Building a Multi-Franchise Business

Exelixis' early-stage pipeline is a testament to its commitment to innovation and growth. With three novel compounds in the pipeline, including XL 309, XPO1, and XL-495, the company is focused on efficiently profiling and prioritizing potential winners for advancement into full development. The company's goal is to be a market leader in both GU and GI oncology, and the early-stage pipeline is a critical part of achieving this goal.

Financial Performance and Guidance

The company's financial performance in the third quarter was strong, with total revenues reaching $539.5 million. The guidance for the full year 2024 has been increased, reflecting the robust financial performance and optimism for the future. The company's intention to continue investing in the pipeline while returning cash flow to shareholders underscores its commitment to long-term growth and value creation for its stakeholders.

Conclusion

Exelixis' third quarter financial results demonstrate a company in a strong financial position, with a clear strategic direction for the future. The focus on cabozantinib and zanzalintinib, along with a robust early-stage pipeline, positions Exelixis for continued growth and success in the competitive oncology market. The collaboration with Merck on zanzalintinib is a significant milestone, and the company's financial performance and guidance for the future are encouraging. Investors and stakeholders can look forward to Exelixis' continued focus on innovation, growth, and value creation.

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