Exelixis (EXEL) Q4 2025 Earnings Call Transcript

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Date

Tuesday, February 10, 2026 at 5:00 p.m. ET

Call participants

• President and Chief Executive Officer — Michael Morrissey
• Chief Financial Officer — Christopher Senner
• Executive Vice President, Research & Development — Dana Aftab
• Executive Vice President, Commercial — Patrick Joseph Haley

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Takeaways

• US Cabozantinib Franchise Revenue -- $2.12 billion for 2025, representing a 17% increase year over year, reflecting continued market leadership in renal cell carcinoma and neuroendocrine tumors.
• Q4 2025 US Cabozantinib Franchise Revenue -- $547 million, up 6% year over year, with CABOMETYX maintaining lead among oral therapies in key tumor indications.
• Global Cabozantinib Franchise Revenue -- $2.89 billion in 2025 and $754 million in Q4 2025; figures include Exelixis and partners, showing strong international demand.
• CABOMETYX Neuroendocrine Tumor Revenue -- Exceeded $100 million in 2025, highlighting the product's market share gains after its March approval.
• Total Q4 2025 Revenue -- $599 million, with cabozantinib net product revenues accounting for $546.6 million and royalties from partners totaling $52.8 million.
• Gross to Net for Cabozantinib Franchise -- 28.5% in Q4 2025, lower than prior quarters, with a full-year 2026 estimate of 31%-32% due to changes in payer mix and inclusion of a 2% Medicare Part D discount.
• Operating Expenses -- Q4 2025 operating expenses, excluding restructuring, were $363 million, up from $341 million in the prior year, due to increased manufacturing, NDA-related costs, personnel, and marketing.
• GAAP and Non-GAAP Net Income (2025) -- GAAP net income of $244.5 million ($2.00 per share basic, $0.88 per share diluted); non-GAAP net income of $259.5 million ($0.97 per share basic, $0.94 per share diluted), excluding $15 million in stock-based compensation.
• Cash and Marketable Securities -- $1.66 billion as of year-end 2025, providing ample liquidity for pipeline investments and share repurchases.
• Share Repurchase Activity -- $954 million in stock repurchased during 2025, retiring roughly 24 million shares at an average price of $39.61 per share, with $590 million remaining on the current $750 million authorization.
• ZANZALUTINIB Regulatory Progress -- FDA accepted new drug application for Zanza plus atezolizumab in third-line-plus colorectal cancer, with a PDUFA target action date in December.
• STELLAR-303 Trial Results -- "a 20% reduction in the risk of death with the combination in the broader ITT population at the final analysis."; non-liver metastasis data remains immature and is expected midyear.
• Pipeline Advancement -- Seven pivotal ZANZA studies ongoing or planned, including trials in colorectal and neuroendocrine tumors, with additional early-stage molecules advancing through Phase 1.
• Market Share Gains -- CABOMETYX TRx share rose from 43% to 46% year over year; 15% TRx volume growth for Q4 2025 outpaced the 7% market basket increase.
• Commercial Readiness -- Gastrointestinal sales team expansion completed in January to drive deeper community outreach and prepare for upcoming ZANZA colorectal cancer launch.

Summary

Exelixis (NASDAQ:EXEL) delivered record cabozantinib franchise revenues and expanded its U.S. and global leadership in solid tumor therapeutics. Management described the rapid progress of ZANZALUTINIB, including the FDA’s acceptance of its first NDA for colorectal cancer and a series of upcoming pivotal trials across multiple tumor types. The company executed a large-scale share repurchase program while maintaining a $1.66 billion cash position for pipeline acceleration and commercial expansion. Ongoing pivotal studies and new clinical collaborations for ZANZA were described as cornerstones for potential new oncology franchises. Exelixis signaled continued capital allocation discipline and pipeline prioritization for 2026 and beyond.

• Management highlighted ongoing engagement with the FDA on Zanza’s NDA and noted that the non-liver metastases overall survival final analysis will be available midyear.
• Christopher Senner stated, "our commitment is to complete that this year," confirming intentions for continued share buybacks.
• Executive teams reported that CABOMETYX’s recent approval in neuroendocrine tumors allowed for broad uptake across previously undertreated community settings.
• Pipeline strategy includes development of new franchise molecules beyond cabozantinib and ZANZA, with multiple early-phase assets moving into clinical testing.
• Management discussed expectations of variability in 340B channel volumes and potential gross-to-net fluctuations throughout 2026.

Industry glossary

• TKI (Tyrosine Kinase Inhibitor): Small molecule drugs targeting enzymes involved in signal transduction, frequently utilized in cancer therapies for their ability to block pathways driving tumor growth.
• PDUFA (Prescription Drug User Fee Act) Date: The deadline by which the FDA must take action on a new drug application.
• Gross to Net: Represents the percentage of gross drug sales remaining after deducting discounts, rebates, chargebacks, patient assistance, and other adjustments.
• 340B Volume: Sales facilitated under the U.S. 340B Drug Pricing Program, which requires pharmaceutical manufacturers to provide outpatient drugs at reduced prices to eligible health care organizations.
• ITT (Intention-to-Treat) Population: All patients who were randomized in a clinical trial, used to assess the effect of a treatment regardless of adherence.
• MRD (Molecular Residual Disease): A measure of microscopic levels of remaining cancer cells following therapy, often detected using sensitive molecular diagnostics.
• TRx (Total Prescriptions): The total number of prescription fills for a medication, typically used to gauge market share and product uptake.

Full Conference Call Transcript

Andrew Peters: Thank you, Towanda, and thank you all for joining us for the Exelixis Fourth Quarter and Fiscal Year 2025 Financial Results Conference Call. Joining me on today's call are Michael Morrissey, our President and CEO; Christopher Senner, our Chief Financial Officer; Dana Aftab, our Executive Vice President of Research and Development; and Patrick Joseph Haley, our Executive Vice President of Commercial. They will review our progress for the fourth quarter and fiscal year 2025 ended December 31, 2025. During the call today, we will refer to financial measures not calculated according to generally accepted accounting principles.

Please refer to today's press release, which is posted on our website, for an explanation of our reasons for using such non-GAAP measures as well as tables deriving these measures from our GAAP results. During the course of this presentation, we will be making forward-looking statements regarding future events and the future performance of the company. This includes statements about possible developments regarding discovery, product development, regulatory, commercial, financial, and strategic matters, potential growth opportunities, and government drug pricing policies and initiatives. Actual events or results could, of course, differ materially.

We refer you to the documents that we file from time to time with the Securities and Exchange Commission, which under the heading Risk Factors identify important factors that could cause actual results to differ materially from those expressed by the company verbally and in writing today, including without limitation, risks and uncertainties related to product commercial success, market competition, regulatory review and approval processes, conducting clinical trials, compliance with applicable regulatory requirements, our dependence on collaboration partners, and the level of costs associated with discovery, product development, business development, and commercialization activities. With that, I will turn the call over to Michael Morrissey.

Michael Morrissey: All right. Thank you, Andrew. And thanks to everyone for joining us on the call today. 2025 was a transformational year for Exelixis, with strong growth across all components of our business. We expect to build on this momentum in 2026 and have already made significant progress during a very busy January. Critically, and we will emphasize this here and throughout the call, Exelixis has a singular focus to build a multi-franchise business in solid tumor oncology. Based on the foundation of cabozantinib, the potential of zanzalintinib, and the depth of our early-stage pipeline.

As outlined at our December R&D day, our strategy to build a pipeline of franchises in solid tumor oncology covers three critical dimensions: products, tumor indications, and modalities. It is based on current Exelixis leadership in GU oncology and our aspirational goal to expand our leadership in GI indications with equal intensity and potential upside. The Exelixis strategy for product, tumor, and modality franchises provides the framework to drive both the growth of any overall market we choose to pursue and the potential to capture a greater share of the commercial opportunity with multiple entry points. Our operational model to establish, expand, and entrench any given franchise highlights the potential value for all our stakeholders.

Importantly, progress we have made over the last twelve months, as well as our expectations for 2026 and beyond, are well aligned with this franchise-focused approach. That context in place, we outlined important news and priorities to kick off 2026 at our corporate update in January at the JPMorgan Healthcare Conference. I will not reiterate everything here today, but just focus on the top highlights. Including first, we saw continued strong performance of the cabozantinib business in the fourth quarter and full year of 2025. CABOMETYX maintained its position as the leading TKI for RCC, and the market leader for neuroendocrine tumors, the oral second line plus segment.

Full year 2025, US cabo franchise net product revenues grew 17% to approximately $2.12 billion compared to full year 2024. Fourth quarter 2025, US Cabo franchise net product revenues grew 6% year over year to $547 million compared to the fourth quarter 2024. Continuing its role as a worldwide leading TKI, global cabo franchise net product revenues generated by Exelixis and its partners were approximately $754 million and $2.89 billion in fourth quarter and full year 2025 respectively. Importantly, CABO's US net product revenues exceeded $100 million for the neuroendocrine tumor indication in 2025.

Second, we are excited to accelerate ZANZA as our next potential oncology franchise opportunity in 2026, with the recently announced acceptance of our NDA for the ZanzaAteza combination in third line plus CRC, based upon the STELLAR-303 data. The entire organization is rallying around this important 2026 milestone and we have taken decisive steps to fortify our commercial footprints to maximize the impact of potentially launching two drugs in different indications in successive years. Notably, we have expedited the build-out of our GI sales team in January with the focus to accelerate the growth of the CABOMETYX neuroendocrine tumor opportunity before ZANZA could come online for CRC later in the year.

I think this enhancement could be an important component of our growth narrative in the near term and speaks to the confidence we have in both CABO and ZANZA as we move into 2026. Third, zanzolitinib is rapidly advancing as our next franchise opportunity with seven ongoing and soon-to-start pivotal trials. Along with a variety of important trial concepts under consideration as a potential next wave of pivotal trials. We continue to prioritize ZANZA, as a monotherapy and in combinations, existing and new indications as an expeditious path to a second Exelixis oncology franchise. Importantly, we are excited by the level of interest in new clinical collaborations for Zanza from the JPM meeting.

Could expand the breadth and depth of our ZANZA pivotal trial efforts to potentially define new standards of care for patients with cancer. Fourth, as we highlighted at our R&D Day in December, our Exelixis IND pipeline is full for the next several years. Potential first-in-class and or best-in-class molecules demonstrating differentiating activity based on extensive preclinical testing. All our efforts are focused on identifying the next clinical asset we can move into full development as another potential Exelixis franchise opportunity. Dana will summarize our status today at a high level, and I refer you back to the replay of our R&D Day to dive into the details for Zanza and the rest of our pipeline.

Finally, business development activities continue to focus on late-stage assets in the GU and GI space. We are pursuing back-end loaded pay-for-success transactions that fit into our oncology franchise framework as a top priority. In terms of capital allocation, we are confident we have the balance sheet expected free cash flows advance our pipeline priorities. Access new molecules from external sources when appropriate, and continue our share repurchase program when we believe our shares are undervalued. With that, please see our press release issued an hour ago for our fourth quarter and full year 2025 financial results. And an extensive list of key corporate milestones saved in order. I will now turn the call over to Christopher Senner.

Christopher Senner: Thanks, Mike. For the fourth quarter 2025, the company reported total revenues of approximately $599 million, which included cabozantinib franchise net product revenues of $546.6 million. CABOMETYX net product revenues were $544.7 million. Gross to net for the cabozantinib franchise in the fourth quarter 2025 was 28.5%, which is lower than the gross to net we experienced in 2025. This decrease in gross to net deductions in 2025 primarily related to lower PHS and 340B volume compared to the third quarter 2025. Additionally, we estimate that our gross to net for the full year 2026 will be between 31-32%.

As previously disclosed, Exelixis has been designated as a specified small manufacturer, which requires Exelixis to pay a 2% discount in 2026 on all Medicare Part D sales, and is included in our gross to net estimate for the year. Our CABOMETYX trade inventory was slightly higher at 2.2 weeks on hand at the end of the year when compared to the third quarter 2025. Total revenues in the fourth quarter 2025 also include approximately $52.8 million in royalties earned from our partners Istin and Takeda, on their sales of cabozantinib. Our total operating expenses, excluding restructuring expenses for the fourth quarter 2025, were approximately $363 million compared to $341 million in 2025.

The sequential increase in these operating expenses was primarily driven by higher manufacturing costs for drug development candidates, NDA filing fees, personnel expenses, and higher marketing expenses, offset by lower stock-based compensation in the fourth quarter 2025. Provision for income taxes for the fourth quarter 2025 was approximately $8.2 million compared to a provision for income taxes of approximately $58.8 million for 2025. This decrease in tax provisions was related to items that were recognized in 2025. The company reported GAAP net income of approximately $244.5 million or $2 per share basic and $0.88 per share diluted for 2025. The company also reported a non-GAAP net income of $259.5 million or $0.97 per share basic and $0.94 per share diluted.

Non-GAAP net income excludes the impact of approximately $15 million of stock-based compensation expense net of the related income tax effect. Cash and marketable securities for the year ended December 31, 2025, was approximately $1.66 billion. During fiscal year 2025, we repurchased $954 million of the company's outstanding common stock, resulting in the retirement of approximately 24 million shares of the company's outstanding common stock at an average price per share of $39.61. As of the end of fiscal year 2025, we had approximately $590 million remaining under the $750 million stock repurchase plan authorized by the company's board in October 2025. And finally, turning to our financial guidance for the full year 2026.

We announced our 2026 financial guidance during the JPMorgan Conference in January, which is detailed on Slide 19 of our earnings presentation. With that, I will turn the call over to Patrick Joseph Haley.

Patrick Joseph Haley: Thank you, Chris. CABOMETYX business remains strong in 2025. The team continued to execute at an extremely high level, with CABOMETYX continuing to be the number one prescribed TKI in renal cell carcinoma, the number one TKI plus IO combination, first-line RCC, and the number one oral agent, second line plus neuroendocrine tumors. This is an exciting time for the team with zanzalutinib on the horizon. As we prepare to launch our next franchise molecule, which will also expand the Exelixis GI franchise. Prescription data in the oral TKI market basket of cabo, lenvatinib, axitinib, sunitinib, and pazopanib convey the strength of cabo relative to the competition.

Looking at the TRx comparison, for Q4 2024 to Q4 2025, CABOMETYX grew three share points from 43% to 46%. Importantly, CABOMETYX TRx volume grew 15% in Q4 2025 compared to Q4 2024, outpacing the growth rate of the market basket, which was 7% for the same period. Physicians are responding positively to the broad net label and the contemporary trial design and perceive the efficacy and tolerability of cabo as favorable relative to other small molecule therapies in the space.

Subscribers are using cabo broadly across patient and tumor characteristics, including patients with neuroendocrine tumors arising in the pancreas, GI tract, and lung, across all tumor grades, functional and SSTR status, and those who have received prior treatment with Lutathera. Turning to new patient market share for second line plus neuroendocrine tumors in Q4, we are pleased that CABOMETYX remains the market leader in the oral therapy segment. Additionally, our research indicates that there is an opportunity to continue to grow market share, particularly in the community. As Mike highlighted, CABO 2025 revenue in neuroendocrine tumors exceeded $100 million. The team is fully engaged in driving growth in this indication in 2026, with a strong focus on the community setting.

For that reason, we are pleased that we have completed the expansion of our GI sales team, which will yield greater reach into the community in order to continue to grow net market share for CABOMETYX. Our new representatives join us with significant oncology sales experience, particularly in colorectal cancer and GI oncology. We are excited to have them hit the ground running. Importantly, the expanded team will be able to gain valuable experience selling cabo before we turn our focus to the potential launch of zanzalutinib in colorectal cancer. We are thinking about building on and expanding our GI franchise and are thrilled with the results of STELLAR-303 and a PDUFA date set for later this year.

Pending regulatory approval, we believe that these data will provide Exelixis with a compelling commercial opportunity in one of the big four tumors. Our market research and advisory boards demonstrate positive feedback and excitement for the STELLAR-303 data. Physicians reiterate the significant unmet medical need for patients in the third line plus CRC setting and are excited for the potential to have an ICI option available for the broader population of CRC patients. In closing, we are pleased with the growth of the cabo business both in RCC and NETs. In neuroendocrine tumors, prescribers see CABOMETYX as the more favorable choice versus other previously approved generic small molecule therapies.

Simultaneously, our internal team is in full launch preparation for ZANZA, and the excitement around these efforts is palpable. We look forward to the opportunity to launch the next Exelixis franchise later in the year to be able to help appropriate patients with colorectal cancer. Beyond Stellar-303, we are enthusiastic about the significant development plan for ZANZA, which could position the ZANZA franchise to far exceed cabo in terms of the number of patients that could be impacted across tumor types and settings. And with that, I will turn the call over to Dana Aftab.

Dana Aftab: Thanks, PJ. Our strategy in R&D is on building franchises in key solid tumor indications, and we continue to be focused on maximizing our productivity with disciplined investment in high-value opportunities for our portfolio. Zanza is clearly our next big franchise opportunity, with seven ongoing or planned pivotal studies, so my update today will be focused mostly on Zanza, but I will also touch on our earlier stage pipeline of small molecules and biotherapeutics. As Mike mentioned earlier, the FDA accepted our new drug application submission for ZANZA with a PDUFA target action date of December.

The NDA is based on the results from the STELLAR-303 trial comparing the combination of Zanza plus atezolizumab versus regorafenib in patients with non-microsatellite instability high colorectal cancer who had received multiple prior therapies. As a quick reminder, the trial has dual primary endpoints designed to assess survival outcomes, more specifically in the population of patients without liver metastases, which we refer to as the NLM patients or population, and more broadly, in the intention to treat or ITT population, which includes patients both with and without liver metastases. The study met one of its dual primary endpoints, demonstrating a 20% reduction in the risk of death with the combination in the broader ITT population at the final analysis.

While data pertaining to the other dual primary endpoint of overall survival in the NLM population showed a trend in overall survival favoring the combination, the NLM data were immature at the data cutoff, and the trial has been proceeding to the planned final analysis for this endpoint, and we expect to have those top-line results around the middle of this year. Needless to say, we are very excited about engaging with regulators on this first NDA for Zanza in combination with Atezo, which, if approved, could potentially become a new standard of care for CRC patients who have received multiple prior therapies.

We believe that the STELLAR-303 results demonstrate clear clinical differentiation of ZANZA from other TKIs and IO combination partners investigated in this space and that ZANZA's differentiated mechanism of action, including inhibition of the TAM kinases and MET, is a key factor in this clinical differentiation and underscores Zanza's franchise potential. As a next step toward realizing that potential, our team is highly focused on investigating Zanza in an earlier setting in patients with colorectal cancer. To that end, we are planning to initiate the STELLAR-316 trial this year in patients with colorectal cancer or positive for molecular residual disease or MRD after completing definitive therapy.

By definitive therapy, we mean breast cancer patients who have been treated with total neoadjuvant therapy followed by surgery, or colon cancer patients who had surgery followed by adjuvant chemotherapy. About 20% of patients are MRD positive following definitive therapy, and these patients typically have a poor prognosis, with median disease-free survival times in the six to eight-month time frame. Critically, these patients have no therapeutic options that have been shown in a phase three trial to prevent or delay metastatic progression of their disease. Thus, this represents a significant opportunity in the colorectal cancer landscape.

In STELLAR-316, MRD will be determined with the Signatera circulating tumor DNA test, and we are very excited to be working with Natera as our diagnostic partner in this endeavor. Their commercial test is very extensively utilized in this setting, and their database built from testing thousands of patients each year gives us incredible insight and clarity regarding patient demographics and outcomes. Some of the primary hurdles in phase three trial execution are around site performance and patient recruitment, but we now have information from our partner that should help us focus on prioritizing activation of clinical trial sites that are already known to have the highest cadence of testing and the highest numbers of eligible patients.

Thus, once STELLAR-316 is initiated, around midyear, we expect enrollment to be quite brisk. Moving on to other trials, STELLAR-201 is a single-arm phase two trial designed to evaluate ZANZA in patients with recurrent meningioma, and we expect that trial to initiate around the middle of this year. STELLAR-311 is our phase three trial evaluating Zanzak compared to everolimus as an initial oral therapy in patients with neuroendocrine tumors. That study was initiated last year and is proceeding on schedule. And STELLAR-304 is our pivotal trial evaluating the combination of Zanza plus nivolumab versus sunitinib in patients with locally advanced or metastatic non-clear cell renal cell carcinoma.

We expect top-line results from STELLAR-304 around midyear, and if positive, those results could lead to our second NDA filing for ZANZA. Finally, progress continues with regard to the phase two Umbrella study being conducted by Merck in which the combination of Zanza plus belzutafen is being evaluated in patients with previously treated metastatic RCC. And two pivotal studies that Merck is running in clear cell RCC evaluating Zanza in combination with Bell's. One of those pivotal studies is LightSPARK 33, which is comparing Zanza plus Bell's versus cabo as frontline therapy for patients who received anti-PD-1 or anti-PD-L1 therapy in the adjuvant setting. And that study initiated in December.

We will update you on the details of the other phase three study as they become available. Given the demonstrated clinical differentiation we have seen with Zanza and its potential to be the TKI of choice for combinations with immunotherapies and other mechanisms of action, we are continuing to assess the landscape of additional opportunities for Zanza development. To that end, we have engaged in discussions with potential collaborators on exciting new combinations, and we look forward to sharing more details of these opportunities as we get closer to launching the trials. Now shifting to our early clinical pipeline, we have four molecules in this space that are currently in clinical development, namely XL-309, XP-010, XB-628, and XB-371.

And the phase one studies for these early molecules are progressing well. In terms of earlier stage development candidates, we are continuing to advance exciting new small molecule and ADC programs, and I look forward to sharing more details as these early pipeline programs advance. Our strategy with the early pipeline is focused on identifying the next potential franchise molecules beyond cabo and zanza, so we will continue our approach of getting to go/no-go decisions quickly and efficiently, leveraging our expertise to pick the winners and ultimately maximize impact for patients. So with that, I will turn the call back over to Michael Morrissey.

Michael Morrissey: All right. Thanks, Dana. I will wrap up here by thanking the entire Exelixis team for their outstanding efforts in 2025. As we reflect on the substantial progress we have made over the last twelve months, we importantly look forward to 2026 as a potentially transformational year for the company. We will continue to execute on all cylinders with cabozantinib, while also preparing for what could be a second potential franchise with zanzalintinib. All while we continue to advance our early-stage pipeline. As always, I want to commend everyone at Exelixis for their individual and collective efforts, urgency, and focus as we strive to excel in our mission to help cancer patients recover stronger and live longer.

We look forward to updating you on our progress in the future. Thank you for your continued support and interest in Exelixis. And we are happy to now open the call for questions.

Operator: Thank you. Ladies and gentlemen, as a reminder to ask a question, then wait for your name to be announced. To withdraw your question, please press 11 again. We ask that you limit yourself to one question only. Our first question comes from the line of Asthika Goonewardene with Truist. Your line is open.

Asthika Goonewardene: Hey, guys. Thanks for taking my questions. So just a technical question here on as you launch Zanza, how long will you be able to benefit from the small manufacturer discount if I can sneak a quick second one in. It is nice to see the share repurchases step up in Q4. Just wondering if you can give any comments on the cadence of repurchases so far for the six weeks of the New Year?

Michael Morrissey: Thank you. Yeah. As the coach, Mike, I will take the first question, and maybe Chris can take the second one. You know, again, do not want to get too far ahead of ourselves with Zanza. We are early in the review cycle for the process, obviously. The small manufacturer exemptions that we have are tied to having a single product. That has the majority of our revenue, and we would think that would be the case for the foreseeable future. I think the cutoff is around 20% for a second product to come into play. So I think we are okay there for a while. Obviously, it is all about the kinetics of any subsequent launch.

So stay tuned on that. Still very early days. Do not want to speculate on the timing for when that could be an issue. Okay? Chris?

Christopher Senner: Thanks, Mike. So I think from a share repurchase perspective, as Mike mentioned in his prepared remarks, we are going to continue to do share repurchases as long as we feel like we are undervalued, and that continues today. You know, we have $590 million left over on the most recent authorization $750 million from the board, and, you know, our commitment is to complete that this year.

Operator: Thank you. Please stand by for our next question. Our next question comes from the line of Paul Choi with Goldman Sachs. Your line is open.

Paul Choi: Hi, thank you. Good afternoon, and thanks for taking our question. My question is just on you comment on recent 340B purchasing behavior and whether you expect that channel to increase? And as along with the Part D redesign, sort of your views on how that could potentially also impact Zamza as you commercialize that in '27? Thank you very much for taking our question.

Christopher Senner: Yeah. Can this So thanks, Paul. It is Chris. From a 340B perspective, we have seen variability throughout 2025 and we are expecting variability, throughout 2026. You know? And that could have an impact on the gross to net just based on the fact that it is a heavily discounted segment of the business. What was the second question? On the Part D redesign, PJ you want address that?

Patrick Joseph Haley: Yeah. Well, I am sorry. Was it Zanza? In terms of in terms of, you know, Zanza, I think how we will obviously, we will be designing our channel to optimize results going forward there. You know, having all the experience we have from Cabo, and being in the market for a decade. So, you know, we will obviously look to customize that for sort of, you know, the current state of the business in the markets? Thank you.

Operator: Please stand back for our next question. Our next question comes from the line of Silvan Tuerkcan with Citizens. Your line is open.

Silvan Tuerkcan: Yes. You, and thanks for taking my questions. Thank you for the details on 03/16 I just have a big picture question here. How big do you think this population is since it is so early in colorectal cancer? And what is the rough timeline for readout here? And additionally, there any reference trials I know that this design is very popular with immunotherapy, but for targeted therapies, I have not seen that yet. Thank you.

Dana Aftab: Sure. Thanks, Sylvain. This is Dana. I will take the question. So with STELLAR-316, the population we are calculating is based on approximately 20% of the patients who have completed definitive therapy and are positive based on the ctDNA tests from the Terra. The data that they have and that we have gleaned from public sources and presentations indicates an opportunity of twenty thousand to twenty-five thousand or so in that range.

Operator: Thank you. Standby for our next question. Our next question comes from the line of Yaron Werber with TD Cowen. Your line is open.

Yaron Werber: Great. Thanks so much for taking my question. Maybe a quick question on NET. It sounds like revenues were over $100 million for the year. Can you maybe just help frame what is it going to take? Do you need to move it up? You know, we kind of in the past, we have thought the opportunity can reach even, you know, $500 to, to $600 and it was sort of more than 50% of the quarter over quarter growth in Q2 to get higher share, or sort of what is the dynamic on the market? Then secondly, just any update on when Merck will start the next study in combination with Zanza? Thank you.

Patrick Joseph Haley: Yeah. Thanks for the question, Yaron. You know, with regards to net, we are really pleased with the start to the launch here, which I will remind you, approval is just kind of the very March there at the end of Q1. So, as you mentioned, very happy to achieve the $100 million in net revenue in 2025. It is still, you know, very early days in terms of the launch. You know, we are very pleased that we have become the number one, oral therapy in the second line plus neuroendocrine tumor segment. But our market research, as I mentioned, indicates there is still, plenty of room to grow there.

And really as we look at it, that is primarily in the community setting. You know, our uptake has been broad across all sort of clinical features of NET, which is great. But what is exciting about having the opportunity to community setting is the fact that we have expedited and really now completed our, expansion of our GI sales team. To really put it, you know, on par with the size of our GU, team gives us the ability to reach much farther, into the community.

And, you know, really do what we need to do to change behavior more broadly because what we see is, you know, physicians responding very favorably to the data and having positive experiences with the drug. So we just need to be in front of them, so that they have the opportunity to use cabo for appropriate patients. So we are looking forward to that. Thank you.

Operator: Our next question comes from the line of Akash Tewari with Jefferies.

Akash Tewari: Hey. Thanks so much. Can you talk about why you and Merck chose to kind of run a trial like LightSpark 033 in this post-adjuvant first-line RCC setting versus what your team did with CheckMate 9ER when you went after PD-1 naive patients? And kind of I am trying to understand is really what percent of first-line RCC patients now are actually getting a PD-1 in an adjuvant setting? How do you think that figure will really evolve as we approach the end of the decade? And maybe just lastly, what profile do you think Zanza plus luzutafen will need to show in a second line plus setting? To support running a trial in the same population as LightSpark 001.

Thank you.

Michael Morrissey: Yeah, Akash. Let start, and I can pass it on to PJ or and or Dana. It is provide color commentary. So again, I think the way we look at the problem and I would advise that you look at the problem is not so much on what is happening today, but what is going to be happening in the, in the future. Think early to mid-thirties, twenty-thirties. Where we are really targeting, you know, having ZANZ to be a standard of care for RCC. Right? If you look at the Cabo story, we have a dominant you know, standard of care TKI RCC in the twenties. Right, based upon all the data we have generated.

And we aspire to do the same thing for Zanza but fast forwarding you know, years ahead, to be able to understand how standard of care will evolve between now and then so that Zanza can be a great player there. So again, we have got three ongoing or planned pivotal trials so far. With RCC. We are having a lot of very important discussions with other potential combination partners that I will frame as having orthogonal MOAs that could, again, give us a lot more bang for the buck, also in RCC that we are really excited about.

So I would look at and I certainly look at it, I would recommend you look at it as this is, you know, the non-clear shell trial, the two Merck trials. Are really just the beginnings of building a franchise for RCC where we can have a dominant position with Zanza in the 20 thirds.

Operator: Thank you. Please stand by for our next question. Our next question comes from the line of Andy Hsieh with William Blair. Line is open.

Andy Hsieh: Thanks for taking our questions. So kind of going back to the previous question, maybe for PJ, do you see an increased utility of cabo monotherapy in the first-line setting just driven by the evolving dynamics in the IO usage mostly in the adjuvant setting.

Patrick Joseph Haley: Yeah, thanks for the question Andy. You know what I would say is we have always had a very reasonable utilization of monotherapy in the first-line setting. If you kind of think back to the Cabo Sun study, which we did as a cooperative group study. That we got an indication based on in sort of single-agent first-line utilization. So there has always been a role and a place for, cabo in the first-line setting. That really continues to be the case, particularly in terms of, you know, the monotherapy segment of that population.

Operator: Thank you. Our next question comes from the line of Sean Laaman with Morgan Stanley.

Sean Laaman: Hi, Mike and team. Hope everyone's well, and thanks for taking my question. Just maybe some updated thoughts. You know, ahead of the non-liver mets OS final analysis in mid-twenty-six, Micah, How do you anticipate positive data impacting your commercial strategy or communication with physicians?

Michael Morrissey: Thanks for the question, Sean. That is a great one for PJ to answer. Over to you, PJ.

Patrick Joseph Haley: Yeah. No. Thanks for the question, Sean. You know, I would say first and foremost, you know obviously the non-liver mets is a subset of the overall ITT population where we have been positive. So, you know, as we think about that, that is a big deal. And the liver mets patients in a sense were kind of the harder to treat segment. So we are really excited about the data we have in hand in the sense that is really going to help us move the needle you know, pending approval for those patients as I mentioned that we see you know, from our research, our advisory boards where there is a significant unmet medical need.

Where the Stellar-303 data really being received positively. You know, obviously, we will see what the non-liver mets data show when that comes. And, you know, I think the way we think about it, that is just more opportunity to help us elucidate the benefit, you know, across the board in advanced third line plus CRC. We have just heard a lot of positives in terms of the data. Particularly when we think about the mechanism of action of the combination. As well as the potential to have an immune checkpoint inhibitor available to a broader population outside of the MSI high population. That is really something we are hearing across the board. From oncologists is important.

And in fact, what we hear from them is literally almost all their patients, are asking for an immune checkpoint inhibitor. So we think this will be, you know, really important for the treating physicians and their patients.

Operator: Thank you. Our next question comes from the line of Michael Schmidt with Guggenheim. Your line is open.

Rosie: Hey, guys. This is Rosie on for Michael. Thanks for taking our questions. I guess just first of all, if you as we look ahead to the December of the date first, 303, can you just comment on the nature of your interactions with the FDA to date whether you currently anticipate an advisory committee as part of the review process. And then secondly, regarding your earlier stage pipeline, how are you thinking about the cadence of initial data disclosures and you provide some color on how you are evaluating those early signals and making the note no good decision on advancing programs? Thank you.

Dana Aftab: Sure. Thanks for the question, Suzanne. This is Dana. So regarding the 303 NDA and interactions with the agency, you know, I will just reiterate, we are super excited about the acceptance of the NDA, and we are very actively engaging with the agency on the filing as is the norm, in these types of activities. So, you know, we are regarding the non-liver mets data, you know, those data are due in, the middle of the year. Those data as well as any other data including like hundred and twenty-day safety update, additional analyses or data cuts the agency asked for will be shared with the agency as part of the normal process.

So all of that is going according to plan, and we are quite excited about our interactions. The know, we are very positive on how things are proceeding. And we are working with the agency very actively. So we are happy. Thank you.

Operator: Our next question comes from the line of Sudan Loganathan with Stephens. Your line is open.

Sudan Loganathan: Hi, everyone. Thanks for taking my question. First wanted to ask, can you comment on any trials ongoing and potentially reading out this year that could challenge cabo in the second line plus RCC setting? And then secondly, how do trials such as that light Spark code 33 and even the combo trial Arcus is running with cabo in the post IO setting could help retain, you know, lead share in RCC as we, like, into the remainder of 2026.

Michael Morrissey: Okay. So thanks for the question. Pete, want to take that one on?

Patrick Joseph Haley: Yeah. Thanks for the question. You know, with regards to ongoing trials, obviously, we are aware that there is, you know, data reading out. At the upcoming GU ASCO meeting. We are following that very closely. You know, I guess the press release should have says it is positive for PFS. I would just remind you, and we heard this sort of very clearly from our KOL in our R&D Day event, and sort of broadly across the board from KOLs and research that to really raise the bar in the standard of care, in RCC at this point overall survival is really critical to do that. So, you know, we will see what the data are.

Anytime you add more drugs into the mix, there is incremental toxicity, and you have to kind of see what the overall profile of the product is. But, you know, we are confident in cabo in our position in the marketplace, in our team, in the data. The data has ripened well as we have seen, you know, data such as contact three from Cabo. So we are confident in our position in RCC. Thank you.

Operator: Our next question comes from the line of Leonid Timashev with RBC. Your line is open.

Leonid Timashev: Thanks, guys. Thanks for taking my question. I just wanted to follow-up on some of the RCC questions. From Sudan and your own. I guess with gross to net looking better than expected, the net launch being stronger than expected, I guess how much growth are we expecting from RCC in 2026? And I guess, is that coming from new patients starts, are there still segments of the population that are underutilizing cabo and RCC Or is it more maybe more playing defense and maintaining share in 2026 is strategy across some of the academic centers. Can you just maybe talk about that?

Patrick Joseph Haley: Yeah. Sure. PJ, why do not take that? And I will provide some color commentary too. Yeah, thanks for the question, Leonid. You know, we are, I mentioned, kind of we are very pleased with our position. And the year we had in 2025 with significant growth in both RCC and obviously from the net launch. So as we look forward, you see from our guidance that we have significant growth we are expecting in 2026, and we really do see that, coming from really both aspects of the franchise in terms of neuroendocrine tumors, as well as RCC as we continue to compete in that space. We are doing so very well.

And, you know, the first-line market is very much our focus, and we believe we can continue to get, get growth coming from those patients in the first-line setting.

Operator: Thank you. Stand by for our next question. Our next question comes from the line of Jason Gerberry with Bank of America.

Jason Gerberry: Hey, guys. Thank you for taking my question. My question is more of just conceptual one because I know you cannot really comment on potential ZANZA pricing, but as you kind of observe, what we are seeing is maybe a trend in higher launch pricing in the last twelve months for cancer therapies, I am just wondering maybe if you can speak to that as a trend. It seems like perhaps maybe sponsors are factoring in things like IRA and compensating for that. And investors have taken notice as well of these higher launch prices. So wonder if you can just comment at all in terms of what you are seeing from a trend perspective. Thanks.

Michael Morrissey: Yeah. Thanks, Jason. Well, I think you actually covered it pretty well. In terms of the data and the facts out there. I would not want to speculate why people are behaving a way, but, you know, you certainly can. So and you did, which is fine. You know we will certainly keep potential pricing opportunities for Exelixis drugs. Certainly exams would not have under our hat until the appropriate time. But I am really glad that you highlighted some of the trends as they are going forward, which I think the way you frame it is probably a reasonable way to kind of put things in perspective. So thanks for doing that. Thank you.

Operator: Our next question comes from the line of Esther Drouot with Barclays.

Luke: Hi, this is Luke on for Hector. Thanks for taking my question. For non-clear cell, can you give some can you give some color around like what you the market size to be and what your expectations around outcomes relative to standard of care is? I mean, in your R&D slides, you list, you know, sunitinib or cabonivo or pembrolin as standard of care. Do you have any visibility as to you know, what proportion of patients get those three regimens and like, with that, do you have any idea as to how much cabo revenue is currently attributable to non-clear cell?

Patrick Joseph Haley: DJ? Yeah. Thanks for the question, Lucas. You know, I guess, to start with, you know, as we have said before, non-clear cell, RCC is approximately 20% of renal cell carcinoma. And you know, I guess a little perspective on the non-clear cell portion of RCC today, just like sort of the entire market of renal cell carcinoma, it is very competitive. You know, you mentioned a number of regimens, therapies, that can be used there and are used there. And just like there is hotly contested sort of the broader RCC non-clear cell is the same, so, you know, we believe that sets us up really well in terms of 304. Should we have a positive outcome there?

Because, you know, this is, very much an underserved and understudied part of the population in terms of these non-clear cell patients and 304 is really the first, pivotal registrational phase three study looking at this population. So you know, as you think about that, that becomes very significant in terms of, you know, the ability to really identify those patients in a specific benefit in that population. You know, so what we hear from KOLs is that will be very important in terms of the potential benefit for those patients and elucidating it in furthermore, you know, it is really exciting to us to have a potential entry point obviously for ZANZA into RCC.

You know, this is obviously our major franchise in terms of cabo and something we look forward to expanding on. And as Mike kind of alluded to earlier, we view this as just the beginning for ZANZAN RCC. We have got, know, the Merck studies, and as has been mentioned here today, you know, many other potential opportunities we are looking at in combination partners. So kind of like we did in Cabo and covering the landscape with multiple clinical trial data readouts to really become the standard there. That is our view and approach, for ZANZA and RCC as well.

Operator: Thank you. Our next question comes from the line of Stephen Willey with Stifel. Your line is open.

Stephen Willey: Yeah. Good afternoon. Thanks for taking the question. I think you have previously intimated that you are conducting some additional work on ZANZA dose optimization in just curious if this data is going to be used to inform, a starting ZANZA dose for Stellar 316. And whether you would potentially expect to submit any of this additional dose optimization data as part of the ongoing NDA review? Thanks.

Dana Aftab: Sure. This is Dana, Steven. Thanks for the question. So, yeah, our approach is always to use the optimal dose, in any pivotal study. That is appropriate to each individual setting which might be influenced by a number of factors including stage of disease, potential combination partner, expected duration of treatment, etcetera. So we take that approach with every study. And we will continue to do so for the foreseeable future certainly for STELLAR-316. With STELLAR 303, as we mentioned I think during an event at ESMO. We do have data that we feel are quite strong supporting contribution components and shared those data with the agency as part of the review. Thank you.

Operator: Our next question comes from the line of Jay Olson with Oppenheimer. Your line is open.

Jay Olson: Oh, hey, guys. Thanks for taking the question. As you plan for the commercialization of Zanza, since this would be the first approval, how should we think about the launch trajectory in CRC And since it is also a new indication for atezo, is there any work that Roche is doing that you are aware of to ensure a rapid uptake for this innovative combination regimen? Thank you.

Patrick Joseph Haley: Yeah. Yeah. Thanks for the question, Jay. You know, I what I would say is in terms of what we are expecting in the marketplace, as I mentioned, we see a significant unmet medical need here. And it is very exciting to launch a new product and a new combination. In the marketplace. As I mentioned, our team here, we have been working very hard on it. And folks are very excited about that. You know, I do not want to sort of get ahead of any specific forecasts or guidance with regards to that. But what I would say is that, you know, the market here is fragmented. We have talked about that before.

You see in the third line plus CRC market, you see approximately a third TKIs. You see about a third Lonsurf Bev in terms of the sunlight regimen. And the remaining third is either chemo, or sort of targeted therapies directed at specific you know, biomarker-driven populations. So when you see a fragmented market like that, there is certainly really opportunity to have a significant impact. So that is certainly exciting. And as I mentioned previously, you know, significant overall survival benefit over an active, standard of care as well as the opportunity to have immunotherapy for this broader patient population have been resonating really well with prescribers in our market research. So we are excited to get there.

You know, we are devoting every sort of appropriate resource to this. So we are fully ready to go on the first day of a potential launch. Thank you.

Operator: Please stand by for our next question. Our next question comes from the line of Eva Fortea-Verdejo with Wells Fargo. Your line is open.

Eva Fortea-Verdejo: Good afternoon. Thanks for taking our question. Two quick from Juan. I think the first one on Stellar 304 readout should we be expecting kind of, like, similar to what we saw last year with 303 where we get a press release with limited data and then, like, followed up at a medical meeting with the full data release. If that is the case, what would be, like, a good target meeting? Is this, like, a second half twenty-six event? And then the second question, just within the ASCO GU topic, should we expect any significant updates from SAMHSA? We see a few titles in the program, but perhaps you could comment on these.

Michael Morrissey: Yeah. For the question, Eva. It is Mike. Let me take that. So in terms of 304 top-line results, how to communicate that, stay tuned on that. You know, we look at every opportunity as a separate opportunity based upon what is happening, the data, the timing, other meetings, etcetera. So as we get as we get closer to having top-line results, we will figure that out and then obviously communicate that to you guys in a very compliant fashion. Second question, I missed. Oh, ASCO GU. Yeah. Do not I am not sure we have a lot to offer on that right now. The titles are out.

So I would look at those carefully, and, we will see you there for sure.

Operator: Thank you. Our next question comes from the line of Ash Berman with UBS. Your line is open.

Ash Berman: Oh, hi. Thanks for taking my question. So just on 4Q, looking at the strong net growth that you saw and also some gross to net improvement, quarter over quarter as well. Did RCC grow for Cabo So that is the first question. And then secondly, for this upcoming LIGHTSPARG 11 data at the end of Feb yeah. So OS is still maturing. You know that. Right? But in terms of median PFS, like, what type of delta versus the cabo prior ten months can have a near-term impact? On your RCC sales. Thanks.

Patrick Joseph Haley: Yeah, thanks for the question. As I mentioned in my prepared remarks, we are really pleased with the business and the momentum as we looked at the quarter, we had strong growth in terms of 15% TRx growth year over year, which, we are very pleased with. And that is, you know, clearly was driven both by RCC and NET. So again, we are excited about that. As I alluded to earlier, we expect to continue to grow both of the franchises this year. As is indicated by our guidance. Thank you.

Operator: Please stand by for our next question. Our next question comes from the line of Kalpit Patel with Wolfe Research. Your line is open.

Kalpit Patel: Hey, good afternoon, and thanks for taking the question. For STELLAR-304, I know you have overall survival as a secondary endpoint. But with the recent FDA draft guidance on using OS when it seems most reasonable, do you anticipate the need to show a benefit in OS to receive a full approval And then also for that same trial, you have submit a as the control arm. But do you think, at least on a cross-trial cross-trial basis, you need to look better than what cabo plus nivo delivers historically in this setting.

Patrick Joseph Haley: PJ, can you take a shot at that?

Patrick Joseph Haley: Yeah. I will talk about, you know, what we need to see in the marketplace. In terms of I think as I mentioned earlier, it is competitive in terms of non-clear cell just as it is in the overall RCC market. You know, again though, as we dial into the specific patient population of non-clear cell RCC you know, that would be a separate and distinct population from the broader phase three studies. For all the regimens on the market today, cabo nivo. So we will have to be very careful not to, you know, sort of sort of mix the data in terms of very different patient population.

So that said, as I mentioned earlier, we are certainly excited about a specific phase three trial which is the only one studying this underserved and understudied population, in terms of non-clear cell RCC and having, you know, positive results are we believe will be very impactful. For the marketplace. Thank you.

Operator: Ladies and gentlemen, at this time, there are no further questions. And so I would turn the call over to today's host, Andrew Peters. Mr. Peters?

Andrew Peters: Hey. Thank you, Towanda, and thank you all for joining us today. We welcome your follow-up calls with any additional questions you may have. That we were unable to address during today's call. Have a great rest of the week, everyone.

Operator: Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

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