On October 29, 2024 Exelixis, Inc. (Nasdaq: EXEL) reported financial results for the third quarter of 2024, provided an update on progress toward achieving key corporate objectives, and detailed its recent and anticipated commercial, clinical and pipeline development milestones (Press release, Exelixis, OCT 29, 2024, View Source [SID1234647504]).

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"The favorable ruling on our cabozantinib intellectual property estate and recently announced zanzalintinib development collaboration with Merck have generated important momentum to drive future growth across all components of our business"

"The favorable ruling on our cabozantinib intellectual property estate and recently announced zanzalintinib development collaboration with Merck have generated important momentum to drive future growth across all components of our business," said Michael M. Morrissey, Ph.D., President and CEO, Exelixis. "We are increasing 2024 full year guidance for total and net product U.S. revenues based on the strong commercial performance of the cabozantinib franchise in the third quarter. We continue to execute on our plans for potential cabozantinib label expansions in neuroendocrine tumors and prostate cancer, with the final results from CABINET published in The New England Journal of Medicine in September and our partner Ipsen’s regulatory submission in Europe."

Dr. Morrissey continued: "Importantly, the zanzalintinib development program, which is now the subject of six ongoing or planned phase 3 pivotal trials, including two new renal cell carcinoma studies as part of our collaboration with Merck, headlines our emerging pipeline of novel agents with the potential to improve standards of care for patients with cancer. At the same time, we are accelerating our early-stage clinical pipeline with XL309, XB010 and XL495 in phase 1 development. I want to thank everyone at Exelixis for their hard work and dedication as we continue driving value for shareholders and innovating on behalf of the patients we serve."

Third Quarter 2024 Financial Results

Total revenues for the quarter ended September 30, 2024 were $539.5 million, as compared to $471.9 million for the comparable period in 2023.

Total revenues for the quarter ended September 30, 2024 included net product revenues of $478.1 million, as compared to $426.5 million for the comparable period in 2023. The increase in net product revenues was primarily due to an increase in sales volume and average net selling price.

Collaboration revenues, composed of license revenues and collaboration services revenues, were $61.5 million for the quarter ended September 30, 2024, as compared to $45.4 million for the comparable period in 2023. The increase in collaboration revenues was primarily related to an increase in milestone-related revenues recognized in the quarter and higher royalty revenues for the sales of cabozantinib outside of the U.S. generated by Exelixis’ collaboration partners, Ipsen Pharma SAS (Ipsen) and Takeda Pharmaceutical Company Limited, partially offset by a decrease in development cost reimbursements earned.

Research and development expenses for the quarter ended September 30, 2024 were $222.6 million, as compared to $332.6 million for the comparable period in 2023. The decrease in research and development expenses was primarily related to decreases in license and other collaboration costs.

Selling, general and administrative expenses for the quarter ended September 30, 2024 were $111.8 million, as compared to $138.1 million for the comparable period in 2023. The decrease in selling, general and administrative expenses was primarily related to decreases in corporate giving, stock-based compensation expenses and legal and advisory fees.

Impairment of long-lived assets for the quarter ended September 30, 2024 of $51.7 million was related to the non-cash asset impairment charge to certain of Exelixis’ leased facilities which are currently not in use and may be subleased.

Provision for income taxes for the quarter ended September 30, 2024 was $36.8 million, as compared to $4.8 million for the comparable period in 2023.

GAAP net income for the quarter ended September 30, 2024 was $118.0 million, or $0.41 per share, basic and $0.40 per share, diluted, as compared to GAAP net income of $1.0 million, or $0.00 per share, basic and diluted, for the comparable period in 2023. GAAP net income per share for the quarter ended September 30, 2024 was favorably impacted by lower weighted-average common shares outstanding for the quarter ended September 30, 2024, as compared to the comparable period in 2023, as a result of the stock repurchase programs.

Non-GAAP net income for the quarter ended September 30, 2024 was $135.7 million, or $0.47 per share, basic and diluted, as compared to non-GAAP net income of $32.1 million, or $0.10 per share, basic and diluted, for the comparable period in 2023.