Exelixis at Leerink Global Healthcare Conference: Strategic Growth and Innovation

On Wednesday, 12 March 2025, Exelixis (NASDAQ: EXEL) presented its strategic vision and financial outlook at the Leerink Global Healthcare Conference 2025. The company highlighted its evolution into "Exelixis 3.0," focusing on growth through strategic investments and a shareholder-friendly approach. The discussion centered around the promising future of its key products, cabozantinib and zanzalitinib, while maintaining a cautious outlook on regulatory challenges.

Key Takeaways

• Exelixis aims for cabozantinib to reach $3 billion in revenue by 2030.
• The 2025 revenue guidance for cabozantinib is set between $1.95 billion and $2.05 billion, marking an 11% year-over-year growth.
• Zanzalitinib presents a $5 billion market opportunity across six pivotal trials.
• The company is focusing on strategic acquisitions to enhance its product portfolio.
• Collaborative efforts with the FDA are ongoing for new indications.

Financial Results

• 2025 Net Product Revenue Guidance (Cabozantinib): $1.95 billion to $2.05 billion
• Midpoint of 2025 Guidance: $2.0 billion
• Year-over-Year Growth: Approximately 11%
• Projected Cabozantinib Revenue by 2030: $3 billion
• Zanzalitinib Market Opportunity: $5 billion across six pivotal trials

Operational Updates

• NET Indication: PDUFA date is set for April 3. The AdCom was initially scheduled but later canceled.
• Salesforce Expansion: Approximately 80% of NET oncologists in the US are covered by Exelixis’ field force, with a marginal expansion at the end of the previous year.
• Zanzalitinib Trials: Topline data for STELLAR-303 (colorectal cancer) and STELLAR-304 (non-clear cell RCC) are expected later this year.

Future Outlook

• Strategic Objectives: Focus on cabozantinib growth, potential NET indication approval, and expansion of zanzalitinib into new indications.
• Pipeline Advancements: Development of early pipeline programs like XL309/0628.
• Business Development: Emphasis on strategic acquisitions to enhance value.

Q&A Highlights

• FDA Interactions: Exelixis maintains a collaborative relationship with the FDA, focusing on label negotiations for the NET indication.
• Zanzalitinib Differentiation: The company is targeting indications where cabozantinib does not have a label, focusing on positive trial outcomes.

Exelixis remains committed to its mission of improving patient outcomes, which it believes will drive shareholder value. For more detailed insights, refer to the full transcript below.

Full transcript - Leerink Global Healthcare Conference 2025:

Andy Barrons, Senior Biotech Analyst, Learing Partners: All right. Good morning, everyone. I’m Andy Barrons, Senior Biotech Analyst at Learing Partners. Thank you for joining us on day three, the final day of our global healthcare conference in beautiful, sunny Miami at the W Hotel. We’re very excited to have Exelixis with us.

We have we’ll have Chris and Andrew of Maxillis. Thank you, gentlemen, for spending some time with us to walk us through the story. Why don’t we start, I guess, with a brief overview of Maxillis. Obviously, you’ve been been around a while. It’s accomplished a lot.

You have commercial assets and a lot of stuff in the pipeline we’ll talk about, but I think would help to get an overview of the company.

Andrew, Exelixis: Yes. So thank you for the invite. Happy to be here. And I’d say the elevator situation a little late, but it’s excited to have the conversation and great meetings so far this week. As a reminder, before I begin, we’ll be making Chris and I will be making some forward looking statements today.

So please see relevant risks and disclosures in our regulatory filings. So Exelixis is a thirty year old company at this point. And I think really unique in kind of the biotech, biopharma landscape in that we have cabozantinib, our main product. We’ve given guidance from about $2,000,000,000 in the midpoint in product revenue this year. We’re profitable.

We always like to say we run the business like a business, not a biotech. And we use that kind of philosophy, that mentality to really make sure that we’re investing in growth and kind of in the future. And I’m sure we’ll get to the pipeline later, but also making sure that we’re shareholder friendly as well. And Chris can talk about a lot of those activities from a capital allocation perspective and share buybacks and all of that. But cabozantinib, lead product, mostly used in kidney cancer.

Number one, tyrosine kinase inhibitor in monotherapy as well as in combination. And then behind that, we have zanzolitinib, which is kind of a next gen version of cabo as well as a whole host of other earlier stage programs. I guess kind of from an overview perspective, I think I’d point to the third quarter call we hosted last year, really because that was a chance for us to really talk about Exelixis three point zero. So after about a long five years of litigation with generics company around Cabo’s core LOE, we kind of got that behind us. And we really had a chance to basically reframe the story for folks and say, okay, this is who Exelixis is.

We gave guidance for cabozantinib in our expectation for Tigro to be a $3,000,000,000 product by 02/1930 on really on the momentum of continuing momentum of the base business and then our anticipation or our expectation for growth coming from a new product launch or a new indication launch for neuroendocrine tumors for cabo. And then secondly, we kind of framed out what we see as the market opportunity for zanzalitinib across the six pivotal trials that we’ve announced or ongoing with ZANZZA at around $5,000,000,000 And then what we also said is kind of the cadence of those data readouts and those anticipated timelines basically partly by design, partly candidly by luck, really the meat of that growth curve for Zanza is right as that 02/1931 cabo LOE date comes up. And so we don’t really see that typical post LOE transition period. We actually think the Zans opportunity is sufficiently large enough that we see kind of growth really going forward from here. And so behind that, a whole host of really interesting best in class, first in class molecules from our own kind of internal discovery effort.

And then that last leg of the stool is being opportunistic from a business development perspective, using our balance sheet strategically to identify and bring in external assets that we like. So kind of that ExLexus three point zero framing is kind of what we started with last year and kind of have continued to execute on.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Yes. And I think that vision of Ex Lexis three point zero obviously resonated with investors. I think that’s when your stock really broke out of a trading range that had been in for quite a while, and it’s done well even despite the hard times that a lot of the colleagues in biotech have experienced. So congratulations on that. Chris, maybe we could talk just a little bit about the guidance, the Kaaba guidance in 2025.

Can you just give us what’s behind those those numbers, some of the pushes and pulls?

Chris, Exelixis: Sure. So, from a so our guidance is won’t for net product revenue is, 1,950,000,000.00 to 2,050,000,000.00. As as Andrew talked about, the midpoint of that range is $2,000,000,000, which is about 11% growth year over year, and we grew about an 11% comparing 2024 to 2023. So consistent growth. And that guidance does not include our the new indication Andrew had mentioned, the NET indication neuroendocrine tumors.

And so, you know, it’s it’s continued growth in the RCC segment, and we continue to see great momentum on new patient starts. In our TRX share, it continues to grow. And, you know, we it’s it’s really around that guidance is really around RCC. And then, you know, from a net perspective, you know, we’ll provide that guidance sometime this year after, after launch.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Right. Why don’t we talk a little bit about cabo and the net indication? You originally had an adcom scheduled. The PDUFA date is April 3, and then it was essentially canceled. And I believe that was before a lot of the government cuts that have come down subsequently.

So any color that you can give to us investors about what drove the initial decision to schedule that and then the subsequent decision to cancel it?

Andrew, Exelixis: Yes. I mean, so we haven’t really given a lot of kind of detail around the consistent back and forth with the agency other than we have a very collaborative collegial relationship with FDA and we’ve been working with them for a very long time across all of the COMETRIQ and CABOMETYX indications. And so we’ve been very happy with kind of the back and forth so far. At the time that the AdCom was announced, we said that given the history of oral agents in NETs, we weren’t really expected that an AdCom was called. And similarly, given the outcome of those, we weren’t really surprised that it was canceled as well.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Have those discussions included label negotiations with the FDA?

Andrew, Exelixis: Yeah. We again, we don’t kind of comment on kind of the extent of the regulatory discussions, but there’s a very collegial back and forth with the agency. Okay.

Andy Barrons, Senior Biotech Analyst, Learing Partners: You don’t have NET in in your guidance, at this point, but if approved and and and you will give it. What, what what will you have to do to expand the infrastructure to repair for potential net?

Chris, Exelixis: Yeah. So the net so there’s from a from a prescriber perspective, there’s around 3,500 net oncologists in The US, of which we cover about 80% of those today, based on our current field force. And so about 2,800 of those are covered today. And the other 700 or so, we there’s there’s there’s either prescriber in that the great majority of those is a prescriber in that that group, that doctor’s group that has prescribed cabo. So it’s not a we we expanded our Salesforce, very very marginally, incrementally last year, the end of last year.

So it’s already in our guidance, our SG and A guidance for the year. And so it’s not a big expansion. It’s really just an incremental expansion that, that’ll and we’re ready to go, ready for approval and ready to launch.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. The 3,000,000,000 number that you pointed to in 02/1930, it does look like consensus is is supportive that that you’ll reach that number. How much is for CRPC in that guidance number, the $3,000,000,000

Andrew, Exelixis: Very minimal. Yes. So I think what we had said at the time is it’s a heavily risk adjusted contribution from CRPC. So we had given kind of prior commentary around an anticipated filing for prostate by the end of last year. But with kind of the net filing kind of continuing to kind of move forward and then the adcom is a little bit of an all hands on deck from a resource perspective.

And so we pushed out decision on the filing to this year. So once kind of we get net across the finish line, so to speak.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Why don’t we move to Zanza? I think obviously, a big part of fundamental but also probably strategic value for the company is going to be a viable tale to continue the success you’ve had with CABO. Can you just walk us through the profile of Zanza versus CABO Why don’t we start there and then we’ll talk about the development?

Andrew, Exelixis: Yes. So Zanza was initially kind of conceived as a really a next gen version of CABO. So if you think about the continuum of VEGF targeting TKIs, cabo is really designed and the hypothesis around it was some of those first gen versions of the VEGF TKIs eventually developed resistance primarily around kind of MET, axel, MR pathways, TAM kinases. And so what we had thought with kind of the original cabozantinib was, can we also target those kinases to essentially preamp resistance development in around kind of that anti angiogenesis profile. And so that’s CABO’s special sauce, so to speak, is that it not only deeply hits VEGF, but some of those others as well.

And so when we were thinking about Zansa and how to improve the profile to kind of create a next gen version of that, we thought kind of that kinase inhibition profile was pretty the acutely dialed in. And what we wanted to do is really improve upon what the main liability is, which is relatively long half life. So cabo has around a four day half life. And when you think about that from what it means from a practical patient management perspective, anytime you see an adverse event come up, which all TKIs see adverse events, you need to dose hold till resolution of symptoms and generally re engage at a lower dose. But given that accumulation in plasma and long half life, that period can be ten days to two weeks.

And so from a management perspective, that can be challenging. And then you layer on the fact that we see the future of oncology as multi drug, multimodality combinations going forward. And so having a long half life backbone can be somewhat challenging. So Zanza was envisioned basically asking the question, can we create a kava like TKI with a shorter half life? So our chemists were able to engineer in a metabolic liability into that kind of core cabo scaffold, which has altered its half life for around four days for cabo to a little under twenty four hours for XANZZA.

And so all the data that we’ve presented so far has basically said, yes, we’ve been able to do that. And so what that allows us to do is have a more user friendly version and interrogate XANZZA based combinations in areas that we either didn’t pursue strategically because of financial or kind of cabo profile based reasons, things like colorectal cancer, head and neck cancer and things like that. So we’ve been able to use cabo data as a guidepost to help accelerate development in those areas that we think are particularly sensitive to VEGF targeting TKI and then combine it in a more, much more user friendly way. And then the last piece, obviously, kind of the ultimate profile will come out in pivotal trials with two readouts later this year. But in the data that we’ve presented so far, it certainly shows that we’re seeing that hypothesis confirmed around the shorter half life, but that shorter half life appears to be translated into kind of an emerging profile of potentially better safety.

So if you compare kind of the most apples to apples grouping around ZANZZA monotherapy and clear shell RCC, we’re seeing both a reduced frequency and severity of adverse events, in particular around things like PPE, which from a again, from a patient and patient management perspective can be particularly challenging given the nature of that adverse event. And so that’s kind of the profile that we’re seeing with Zanza and how it was designed and kind of how we envision development going forward.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. In terms of differentiation versus cabo, I think some investors were not convinced at some of the updates that there was a clear differentiation. How important is it that in all these indications, some of which CABO is not approved, that you actually have that differentiation? I mean, can you I mean, obviously, a big part of Exelisys three point zero is extending the tail on the IP of a very successful drug, which like I said, I think adds both strategic and fundamental value. How important is it that there’s a clear benefit for Zansa over cabo to achieve that goal?

Andrew, Exelixis: Yes. That was something we are actually very deliberate about on kind of the last earnings call to kind of touch on. From our perspective, establishing that differentiation against cabo is kind of a little bit of a misguided question because as you mentioned, there’s really no overlap between existing cabo labels in anywhere where we’re developing Zanza. Take colorectal cancer, for example, there’s no cabo pivotal data, there’s no cabo label there. And even something like RCC, the two Merck studies that we’re pursuing with are in combination with belzutafam, where again, cabo will not have a label in.

So kind of this, I want to say, debate in the street, kind of the some of the froth that we started seeing, some of the questions started coming up. We really see it as kind of not a particularly relevant point of discussion given that there’s really no overlap, again, by design between the two molecules.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Right. I mean, it seems to me the most relevant question is, can you get approved and what the data will look like relative to other options in those respective therapeutic areas?

Andrew, Exelixis: Exactly. So one of the first pivotal study to read out with ZANZZA will be from STELLAR-three zero three, and that’s the combination of Atezo and ZANZZA versus rigorafenib and third line plus colorectal cancer. And so that again, we’re much more concerned about how does the profile look like relative to rego. And as you look at kind of the data that we presented at the ASCO GI conference earlier this year with kind of that overall survival for the non liver met subgroup kind of in that eighteen, nineteen, twenty month range, we think looks pretty good relative to what some of the kind of contemporary RCAD, this French group has a database of basically all colorectal cancer therapies and that data would suggest rego in that NLM group does about twelve, twelve point five months. And so we’re encouraged by that separation, but ultimately, we’ll see later this year.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Can we talk that’s obviously a very big milestone for the company, STELLAR-three zero three and third line plus colorectal cancer. Can we talk a little bit about the design of that trial and how it’s changed over the number of years?

Andrew, Exelixis: Yes. So as I mentioned earlier, kind of ZANZATEZO versus REGO, one of the standards of care in colorectal cancer. And really, the design was initially envisioned slightly differently than how the trial looks today. And that’s in part because when Merck’s LEAP 17 study that was looking at pembro plus LENVIMA, lenvatinib, another VEGFR targeting TKI, read out and it was unsuccessful. We used a lot of the learnings from that study to amend ours to really increase the probability of success, primarily around this kind of emerging consensus, looking at the biological differences between patients with liver metastases and patients without liver metastases.

If you look virtually kind of at every study that’s read out recently in colorectal cancer, there seems to be this very clear delineation between those two groups. And so what we did is really amend our study to focus on both of those populations to really try and understand is there a difference between the group and how can each cohort perform on a relative basis. And so that was one of the primary amendments that we made to the study. And so that was really taking a learning from IOTKI study and then applying it to our own IOTKI study with this next layer of we think that Zanza is really kind of that next gen best in class TKI. And so can we approve upon that profile

Andy Barrons, Senior Biotech Analyst, Learing Partners: with a better TKI? How does regorafarib do in liver mets versus non liver mets?

Andrew, Exelixis: Yes. So if you look at the RCAD database, basically, I think about it as three groups of patients that do, I guess, increasingly better. So there’s the patients with liver metastases do, if you look at the data, it’s probably six, seven, eight months overall survival. The ITT, kind of the blended group, say, you know, eight, nine, ten months. And then the non liver mets, you know, ten, eleven, twelve months, probably around twelve months, would be kind of the best guess for REGO.

So even something like REGO does see that difference in the patient population. And then for us, as we look at our data and especially checkpoint inhibitor like atezo, we really see is there is that the patient population that has the opportunity for that typical tail of the curve that’s a hallmark of checkpoint inhibitors to really have a greater effect maybe in that non liver med segment. Ultimately, our job is to establish new standard of care. And so that’s what we’re trying to do is just kind of shift that curve to the right. Right.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Third line plus colorectal cancer, obviously, a late stage disease and a lot of the colons, blood flow and lymphatics strain through the liver. What percentage of the opportunity do you lose by excluding patients with liver mets, do you think?

Andrew, Exelixis: So from a trial design perspective, we’re actually looking at both non liver mets as well as ITT. So our hope is actually to show a benefit in the total population, but the trial is designed to actually look at both groups. But I think our hope is that Zanza and the combination can actually show an improvement across both cohorts. But from a market opportunity perspective, patients without liver mets is about a third of colorectal cancer. But as you think about the differences in anticipated duration, we actually see the two groups as relatively equal from a market size perspective.

So even though it’s a little bit smaller from a patient’s grouping, patient size perspective, the revenue opportunity given the longer duration is about the same.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. What’s your sense for investor expectations? Do you think that if you get the non liver mets population, and it looks approvable in that indication but not in the patients with liver mets, do you think that, that would be a disappointment for investors? Or do you think that’s going to be enough to be a positive catalyst?

Andrew, Exelixis: I think that’s a better question for you. Our job really is to, at the end of the day, we’re here to help patients live longer. And we think that when we help patients live longer, we can sell more drug, we can generate more value. So kind of starting with the patient drives value for everyone else. So that’s what we’re worried about.

Okay.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Fair enough. I’ll start trying to see if I can get that to let you know. The trial was also altered with RAS mutation versus wild type. Can you talk a little bit about the implications and the genesis of that?

Andrew, Exelixis: Yes. So that kind of comes back to some of the early cabo data that we used as a guidepost for Zanza development. And so some of that early cabo data suggested that maybe there was a potential difference between RAS status wild type versus mutant. But again, when LEAP-seventeen read out, their data actually showed that IOTKI patients actually did relatively better in RAS mutants. And so we came to the conclusion looking at that data, looking at our data that again, the much more relevant patient population, patient subgroup was around liver metastases as opposed to RAS status.

We ask the question all the time. I ask our team all the time around biological hypotheses around liver met, non liver met or hypotheses around RAS status. And one of the things that I think is interesting that kind of pops up is if you think about RAS kind of MAP kinase pathway and some of the adjacencies around the TKIs that cabozananda does hit in LENVIMA, maybe that’s a reason why they actually saw in LEAP-seventeen that group do a little bit better. So from a three zero three perspective, we certainly see the liver met and non liver met as much more relevant than kind of RAS. So going back to the ASCO GI data, that was just a wild type grouping, but it’s more of a reflection of what that trial was designed to do.

It was designed and started enrolling before we had made that amendment because that study was actually part of a contribution of components analysis that we need as part of the regulatory filing for three zero three. So the GI data actually just looked at ZANZZA versus ZANZZA atezo to understand the contribution of components there. So we didn’t amend or change that study to look at both RAS mutant and wild type because it was much more of a regulatory driven exercise than signal finding.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Got it. We only have a couple of minutes left, and then I want to make sure we talk about the other programs. Well, I guess before we move to some of the earlier pipeline, what about STELLAR three zero four? Can you just give us a rundown of that program and what you might

Andrew, Exelixis: achieve? Yes. So that’s another one where we’ve said we expect kind of to hit the number of events this year and present that data or to top line that data. So that’s actually the first randomized pivotal study in non clear cell RCC. So it’s the combination of nivo, ZANZA versus Sutent.

Non clear cell RCC is about twenty percent, twenty five percent, twenty percent of kidney cancer. And by the nature of the labels for any of the drugs approved in kidney cancer, cabo included, they all have a label that’s inclusive of non clear cell RCC. But utilization tends to be driven by NCCN guidelines, IST single arm type studies that really don’t provide an answer to the question of what is the kind of highest level of evidence standard of care in that setting. And so three zero four was really designed to set out to answer that question and establish Stanza as the standard of care there. And we hope to generate positive data, help patients live longer and really drive kind of utilization for Zanza in that space.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. And it’s going to be the PFS endpoint that comes out? Correct. How important is OS in the regulatory decision?

Andrew, Exelixis: Yes. I mean, from a regulatory perspective, you can certainly look at kind of the precedents in the clear cell space that PFS is an acceptable endpoint statement of the obvious that having survival in the label makes everything better. So we’re certainly hoping or hoping that the effect size will be large enough to see survival as well. But from a primary endpoint perspective, we certainly think that PFS is good enough to not only if positive drive approval, but utilization as well.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Yes. Okay. Maybe just on the head and neck program. For Zanza, what do you assume is the contribution from head and neck? Because it’s an area we’re very interested in.

We have a number of companies that developing and we think it’s a pretty large opportunity. What are your assumptions for Zanza’s potential there?

Andrew, Exelixis: Yes. So from a market sizing perspective, again, coming back to that $5,000,000,000 Zanza number, about 10 of that we assume is coming from head and neck. It’s about $500,000,000 It’s a good example of just philosophically how we see things like guidance. Obviously, we believe head and neck is a very large market, but we don’t want to put out unreasonable expectations. And so that number really affects fairly conservative utilization.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Okay. Yes. It’s risk adjusted or

Andrew, Exelixis: It’s not.

Chris, Exelixis: It’s not. Okay.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Yes. Because we see this as many multiples beyond that, especially based on the duration of some of these drugs that could expand the market. We only have a few seconds left. What in the early pipeline, besides ANZA is important to the overall strategy for the company going forward?

Andrew, Exelixis: Yes. I think it’s a combination of kind of XL three zero nine or 06/28, or kind of a we have a whole host of what we think are really interesting early programs. But what Chris and I spend a lot of time with is also thinking about capital allocation. If you look at our portfolio, it’s reasonably kind of barbelled. And so can we opportunistically and strategically use our balance sheet to find those mid to late stage assets to add to that next leg of the stool, so to speak, from a value proposition perspective.

We always say we’re a big small company, meaning we’re scaled and sized to be able to take drugs and really run with them. And so I tend to view both our investments in the early pipeline as well as potential external innovation as kind of key drivers going forward. Okay.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Well, we really appreciate the updates. Congrats on all the progress. You got some big readouts this year, and we’ll definitely be watching.

Andrew, Exelixis: Thank you.

Chris, Exelixis: Thanks for

Andrew, Exelixis: having us. Yes.

Andy Barrons, Senior Biotech Analyst, Learing Partners: Thanks for joining us. Thanks, everyone.

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