- 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 -
SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)--Aug. 2, 2017--
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/
Source: Exelixis, Inc.
Exelixis, Inc.
Chris Senner, 650-837-7240
Chief
Financial Officer
csenner@exelixis.com
Susan
Hubbard, 650-837-8194
Executive Vice President, Public
Affairs and Investor Relations
shubbard@exelixis.com