Exelixis Cabometyx Gets Positive CHMP Opinion In Europe

Exelixis, Inc.’s (NASDAQ:EXEL) European partner Ipsen received a positive opinion from the Committee for Medicinal Products for Human Use (“CHMP”) for the use of Cabometyx (cabozantinib) 20 mg, 40 mg and 60 mg for the first-line treatment of adults with intermediate- or poor-risk advanced renal cell carcinoma (RCC).The CHMP is the scientific committee of the European Medicines Agency (“EMA”). The decision will now be reviewed by the European Commission.

We remind investors that Exelixis entered into a collaboration and license agreement with Ipsen in February 2016 for the commercialization and further development of cabozantinib whereby Ipsen received exclusive commercialization rights for current and potential future cabozantinib indications outside the United States, Canada and Japan.

Per the terms, Exelixis is eligible to receive a milestone payment of $50 million for the approval of the first-line treatment of advanced RCC, of which approximately $46 million will be recognized as collaboration revenues in the first quarter 2018. This payment will be paid by Ipsen within 70 days after notification of the approval decision by the European Commission.

The FDA approved a tablet formulation of cabozantinib, (distinct from the capsule form) under the brand name Cabometyx in April 2016 for the treatment of advanced RCC in patients who have received prior anti-angiogenic therapy.

The drug was also approved in Euorpe in September 2016 for the treatment of advanced RCC in adults following prior vascular endothelial growth factor (VEGF)-targeted therapy. The CHMP recommendation to expand the indication is based on results of the CABOSUN trial, which met its primary endpoint of improving progression-free survival compared with sunitinib in patients with previously untreated advanced RCC determined to be intermediate- or poor-risk by the International Metastatic RCC Database Consortium criteria.

In December 2017, the FDA also approved Cabometyx for the treatment of previously untreated advanced RCC, approximately two months ahead of the assigned Prescription Drug User Fee Act action date. A potential approval in Europe will further boost Exelixis’ top line through milestone payments.

Exelixis’ shares have rallied 6.2% over a year, outperforming the industry’s decline of 8.4%.

Exelixis recently submitted a supplemental New Drug Application to the FDA for Cabometyx tablets as a treatment for patients with previously treated advanced hepatocellular carcinoma.

Exelixis has also inked agreements with Bristol-Myers (NYSE:BMY) and Roche Holding (OTC:RHHBY) to develop cabozantinib in combination with immunotherapy agents in 2017.

Zacks Rank & Stock to Consider

Exelixis currently carries a Zacks Rank #4 (Sell).

A better-ranked stock from the same space is Regeneron Pharmaceuticals (NASDAQ:REGN) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron’s earnings per share estimates have moved up from $18.65 to $18.68 for 2018 in the last 30 days. The company pulled off a positive earnings surprise in three of the last four quarters, with an average beat of 9.15%.

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