Replies to post #136714 on Biotech Values

[DewDiligence]

Thanks for your reply. You make some noteworthy points about EXEL’s mindset.

[mcbio]

Very disappointing for Exelixis. I assumed that an XGEVA failure would discourage Exelixis from 308 trial. The conference call statement about 308 being a low priority confirms my thoughts.(Exelixis management didn't seem too interested in talking about the XGEVA events or 308 for that matter, and likely represents the death of planned 308 trial) I don't agree that this is a neutral event for them. Exelixis is already gun shy after SPA incident. I understand Exelixis has limited financial resources, but they need to trust their drug to some degree, and take some shots down the field. These dump off passes down the field could eventually be detrimental for Exelixis. A competitor will eventually pick them off, and take the risk going after these larger markets, while exelixis will be messing around in other phase 2 salvage stage cancer indications. Although a competitive drug isn't in sight, I would guess biotech isn't standing still.

I am starting to believe what others have stated that Exelixis is preparing for a buyout.

But will someone be interested in buying out EXEL if today's vote against XGEVA bodes negatively for EXEL and its main drug's lead indication? And if there is still interest, how lucrative? Those would be my questions. Clearly they have other indications for cabo and I've mentioned before about my interest in their MEK inhibitor but I think most will agree that cabo for CRPC is presumably their key asset and any negative development on that front presumably doesn't bode well for EXEL.

[DewDiligence]

AMGN logged $300M of Xgeva/Prolia sales in 2Q12 (77% in US), so the drug has indeed become the long sought new blockbuster in AMGN’s portfolio:

http://finance.yahoo.com/news/amgens-second-quarter-2012-revenues-200400623.html

Xgeva is outselling Prolia by 3:2.