- Total Revenues of $270.1 Million for the Fourth Quarter of 2020, $987.5 Million for the Full Year 2020 -

- GAAP Diluted EPS of $0.09 for the Fourth Quarter of 2020, $0.35 for the Full Year 2020 -

- Non-GAAP Diluted EPS of $0.14 for the Fourth Quarter of 2020, $0.61 for the Full Year 2020 -

- Conference Call and Webcast Today at 5:00 PM Eastern Time -

ALAMEDA, Calif.--(BUSINESS WIRE)-- Exelixis, Inc. (Nasdaq: EXEL) today reported financial results for the fourth quarter and full year 2020 and provided an update on progress toward achieving key corporate objectives, as well as commercial, clinical and pipeline development milestones.

“I’m very proud of the Exelixis team’s execution in the fourth quarter and full year 2020 as we advanced all components of our business to enable top-line revenue growth in 2021 and beyond,” said Michael M. Morrissey, Ph.D., President and Chief Executive Officer of Exelixis. “Following the strong commercial performance of cabozantinib in the fourth quarter of 2020, Exelixis maintained momentum into 2021 with the FDA approval and launch of CABOMETYX in combination with OPDIVO as a first-line treatment for advanced renal cell carcinoma, based on the CheckMate -9ER study. Our commercial team is now hard at work bringing this important new combination therapy to every eligible patient that may benefit from this potentially best-in-class regimen.”

Dr. Morrissey continued: “Looking ahead, we believe Exelixis is well positioned to deliver significant revenue growth as we pursue additional regulatory approvals for cabozantinib to benefit more patients and work towards a multi-billion-dollar franchise. In parallel, we’re focused on the rapid development of XL092, with plans to advance this next-generation oral tyrosine kinase inhibitor into pivotal trials this year. We also continue to make significant progress on our early-stage pipeline, having recently begun phase 1 development of XL102, our small molecule CDK7 inhibitor, and plan to file an Investigational New Drug application for XB002, our first antibody-drug conjugate, once the drug product release assays are finalized. With significant commercial opportunities and as our growing pipeline of small molecules and biologics matures, we are quickly working toward expanding our oncology product portfolio to further our mission to help cancer patients recover stronger and live longer.”

Fourth Quarter and Full Year 2020 Financial Results

Total revenues for the quarter and year ended December 31, 2020 were $270.1 million and $987.5 million, respectively, compared to $240.3 million and $967.8 million for the comparable periods in 2019.

Total revenues for the quarter and year ended December 31, 2020 included net product revenues of $200.4 million and $741.6 million, respectively, compared to $194.9 million and $760.0 million for the comparable periods in 2019. The decrease in net product revenues for the full year 2020 was due to a decrease in sales volumes, which was partially offset by an increase in the average selling price.

Collaboration revenues, composed of license revenues and collaboration services revenues, were $69.7 million and $246.0 million for the quarter and year ended December 31, 2020, respectively, compared to $45.4 million and $207.8 million for the comparable periods in 2019. The increases in collaboration revenues were primarily related to increases in milestone related revenues and development cost reimbursements earned, 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 (Takeda).

Research and development expenses for the quarter and year ended December 31, 2020 were $154.3 million and $547.9 million, respectively, compared to $94.4 million and $337.0 million for the comparable periods in 2019. The increases in research and development expenses were primarily related to increases in clinical trial costs, license and other collaboration costs, personnel expenses and stock-based compensation expense.

Selling, general and administrative expenses for the quarter and year ended December 31, 2020 were $82.4 million and $293.4 million, respectively, compared to $58.0 million and $228.2 million for the comparable periods in 2019. The increases in selling, general and administrative expenses were primarily related to increases in stock-based compensation expense, corporate giving and personnel expenses.

Provision for (benefit from) income taxes for the quarter and year ended December 31, 2020 was $(0.3) million and $19.1 million, respectively, compared to $16.3 million and $77.1 million for the comparable periods in 2019, primarily due to a decrease in pre-tax income.

GAAP net income for the quarter ended December 31, 2020 was $28.4 million, or $0.09 per share, basic and diluted, compared to GAAP net income of $68.7 million, or $0.23 per share, basic and $0.22 per share, diluted, for the comparable period in 2019. GAAP net income for the year ended December 31, 2020 was $111.8 million, or $0.36 per share, basic and $0.35 per share, diluted, compared to GAAP net income of $321.0 million, or $1.06 per share, basic and $1.02 per share, diluted, for the year ended December 31, 2019.

Non-GAAP net income for the quarter ended December 31, 2020 was $43.3 million, or $0.14 per share, basic and diluted, compared to non-GAAP net income of $81.0 million, or $0.27 per share, basic and $0.26 per share, diluted, for the comparable period in 2019. Non-GAAP net income for the year ended December 31, 2020 was $193.3 million, or $0.63 per share, basic and $0.61 per share, diluted, compared to non-GAAP net income of $364.9 million, or $1.21 per share, basic and $1.16 per share, diluted, for the year ended December 31, 2019. Non-GAAP net income excludes stock-based compensation, adjusted for the related income tax effect.

Cash and investments were $1.5 billion at December 31, 2020, compared to $1.4 billion at December 31, 2019.

Non-GAAP Financial Measures

To supplement Exelixis’ financial results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), Exelixis presents non-GAAP net income (and the related per share measures), which excludes from GAAP net income (and the related per share measures) stock-based compensation expense, adjusted for the related income tax effect for all periods presented.

Exelixis believes that the presentation of these non-GAAP financial measures provides useful supplementary information to, and facilitates additional analysis by, investors. In particular, Exelixis believes that these non-GAAP financial measures, when considered together with its financial information prepared in accordance with GAAP, can enhance investors’ and analysts’ ability to meaningfully compare Exelixis’ results from period to period, and to identify operating trends in Exelixis’ business. Exelixis has excluded stock-based compensation expense, adjusted for the related income tax effect, because it is a non-cash item that may vary significantly from period to period as a result of changes not directly or immediately related to the operational performance for the periods presented. Exelixis also regularly uses these non-GAAP financial measures internally to understand, manage and evaluate its business and to make operating decisions.

These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Exelixis encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP financial information and the reconciliation between these presentations, to more fully understand Exelixis’ business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.

2021 Financial Guidance

Exelixis is providing the following financial guidance for fiscal year 2021:

Cabozantinib Highlights

Cabozantinib Franchise Net Product Revenues and Royalties. Net product revenues generated by the cabozantinib franchise in the U.S. were $200.4 million during the fourth quarter of 2020, with net product revenues of $196.3 million from CABOMETYX® (cabozantinib) and $4.0 million from COMETRIQ® (cabozantinib). For the year ended December 31, 2020, net product revenues generated by the cabozantinib franchise in the U.S. were $741.6 million, with net product revenues of $718.7 million from CABOMETYX and $22.9 million from COMETRIQ. Based upon cabozantinib-related revenues generated by Exelixis’ collaboration partners during the quarter and year ended December 31, 2020, Exelixis earned $23.3 million and $78.4 million, respectively, in royalty revenues. In 2020, global cabozantinib franchise net revenue generated by Exelixis and its partners exceeded $1.0 billion.

U.S. Food and Drug Administration (FDA) Approves CABOMETYX in Combination with OPDIVO® (nivolumab) for Advanced Renal Cell Carcinoma (RCC). In January 2021, Exelixis announced that the FDA approved its supplemental New Drug Application (sNDA) for CABOMETYX in combination with Bristol Myers Squibb’s (BMS) OPDIVO as a first-line treatment of patients with advanced RCC. The approval is based on positive results of the CheckMate -9ER phase 3 pivotal trial, which met its primary endpoint of significantly improving progression-free survival (PFS) and secondary endpoints of overall survival and objective response rate. Exelixis announced the submission of this sNDA in August 2020. In October 2020, the FDA accepted the filing, granting the application Priority Review designation.

Supplemental Applications Submitted for CABOMETYX in Combination with OPDIVO in European Union and Japan for the Treatment of Advanced Metastatic RCC. In September 2020, Exelixis announced that its collaboration partner Ipsen and BMS had each submitted type II variation applications for CABOMETYX in combination with OPDIVO for the treatment of metastatic RCC to the European Medicines Agency (EMA), which was validated by the EMA on September 12, 2020. In October 2020, Exelixis announced that its collaboration partner Takeda, along with Ono Pharmaceuticals Co., Ltd., submitted a supplemental application to the Japanese Ministry of Health, Labour and Welfare (MHLW) for Manufacturing and Marketing Approval of CABOMETYX in combination with OPDIVO for the treatment of patients with unresectable, advanced or metastatic RCC. Both applications are also based on the results from the CheckMate -9ER study.

Exelixis’ Partner Takeda Receives Approval in Japan for CABOMETYX for the Treatment of Unresectable Hepatocellular Carcinoma (HCC) That Has Progressed After Prior Cancer Chemotherapy. In November 2020, Exelixis announced that its collaboration partner Takeda received approval from the Japanese MHLW to manufacture and market CABOMETYX as a treatment for patients with unresectable HCC that has progressed after prior cancer chemotherapy. Takeda’s application was based on the results of two clinical trials in patients with advanced HCC who had received prior systemic therapy: CELESTIAL, a global, randomized, placebo-controlled, double-blind phase 3 clinical trial; and Cabozantinib-2003, a phase 2 clinical bridging trial conducted in Japan. Exelixis received a $15.0 million milestone payment from Takeda upon the first commercial sale of CABOMETYX for unresectable HCC, which occurred in the fourth quarter of 2020.

Announcement of Top-line Results from Pivotal Phase 3 COSMIC-311 Trial of Cabozantinib in Patients with Previously Treated Radioiodine (RAI)-Refractory Differentiated Thyroid Cancer (DTC). In December 2020, Exelixis announced that COSMIC-311, the phase 3 pivotal trial evaluating cabozantinib versus placebo in patients with RAI-refractory DTC who have progressed after up to two prior vascular endothelial growth factor receptor-targeted therapies, met the co-primary endpoint of demonstrating significant improvement in PFS with a hazard ratio of 0.22 (96% confidence interval 0.13 – 0.36; p