Exelixis, Inc.

Good day, ladies and gentlemen, and welcome to the Exelixis Fourth Quarter and Fiscal Year 2024 Financial Results Conference Call. My name is Cherie, and I'll be your operator for today. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to your host for today, Ms. Susan Hubbard, Executive Vice President of Public Affairs and Investor Relations. Please proceed.

Thank you, Cherie, and thank you all for joining us for the XLX's fourth quarter and fiscal year 2024 financial results conference call. Joining me on today's call are Mike Morrissey, our president and CEO, and Chris Center, our chief financial officer, who will review our progress for the fourth quarter and fiscal year 2024, ended January 3rd, 2025. DJ Haley, our executive vice president of commercial, Amy Peterson, our chief medical officer, and Dana Aftab, our Chief Scientific Officer, are also on the call today and will participate in the Q&A portion of the call. 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. Actual events or results could, of course, differ materially. We refer you to the documents we file from time to time with the SEC, which under the heading Risk Factors, identify important factors that could cause our 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. And with that, I will turn the call over to Mike.

All right. Thank you, Susan, and thanks to everyone for joining us on the call today. ExoLexus had a breakout year in 2024, and we're already sprinting into 2025 after a busy January where we provided important updates across all components of our business. ExoLexus has built significant momentum to establish a multi-compound, multi-franchise oncology business as we advance our Cabozantinib, Zanzalentinib, and early pipeline priorities. to meet our aspirational revenue goals of $3 billion for Cabo in 2030 and $5 billion for Zanza in 2033. We're thrilled to see continued growth and momentum of the Cabo franchise in the U.S. and globally, both in terms of absolute revenue and relative growth compared to the competition, and we expect to see additional upside with potential new indications. We outlined important news and priorities to jumpstart 2025 at our corporate update in January at the J.P. Morgan Healthcare Conference. I won't reiterate everything here today, but just focus on the top highlights, including first, we saw a strong performance of the Cabo's Antidote business in the fourth quarter and full year 2024 with approximate 11% growth in demand, new starts and revenue. Cabo Medics maintained its status as the leading TKI for RCC in both the frontline IOTKI market and the second-line monotherapy segment. Fourth quarter, 2024, U.S. Cabo franchise net product revenues grew 20% year-over-year to $515 million compared to fourth quarter 2023. Full year 2024, U.S. Cabo franchise net product revenues grew 11% to $1.81 billion compared to full year 2023. continuing its role as the worldwide leading TKI. Global Cabo franchise net product revenues generated by ExoLexus and his partners were approximately $690 million and $2.5 billion in the fourth quarter and full year 2024, respectively. Chris will review our 2025 financial guidance for the base business in his prepared remarks. We will provide updated guidance, including the net opportunity at a later date post-approval. Second, our top priority is to advance the CABO net indication with ongoing regulatory activities for the SNDA based on the cabinet phase three pivotal trial. As you'll recall, we announced that the FDA had accepted our SNDA seeking approval for CABO xanthinib in both P-net or E-P-net indications with a BDUFA date of April 3rd, 2025. Detailed final results from cabinet were presented at ESMO 2024 and were concurrently published in the New England Journal of Medicine, which supported the addition of CAVO to the recently updated NCCN guidelines for NET. We're collaborating closely with the FDA on the review and won't speak to any details of that process today. As we've highlighted at recent investor conferences and webcasts, we are launch ready and eager to engage as soon as approval is secured. Third, we expect ZANSA to take center stage in 2025 as our next oncology franchise opportunity. Important anticipated ZANSA data milestones from pivotal trials include top line results from stellar 303 in colorectal cancer and stellar 304 in non-clear cell kidney cancer, and a decision to advance to the phase three portion of stellar 305 in head and neck cancer, all projected to occur in the second half of the year pending event rates for each trial. In addition, we expect to initiate the Stellar 311 trial of ZANSA in net in the first half of 2025 and anticipate Merck will initiate two RCC studies evaluating ZANSA plus bosudafan this year. I'll remind everybody again that ExoLexis is running ZANSA pivotal trials against a contemporary standard of care for each trial. Regorafenib for Steller 303, Sinitinib for Steller 304, and a Pembrol placebo combination for Steller 305. Recent speculation during ASCO GI comparing ZANZA to CABO is misguided and a distraction from the focus of our ZANZA development activities. As highlighted on our third quarter call, our $5 billion projection for ZANZA in 2033 is based on success in indications which we believe are independent from any overlap with CABO. Fourth, as we highlighted recently, our ExoLexus IND pipeline is full for the next several years with potentially differentiating molecules based on extensive preclinical testing. In 2025, We're looking to accelerate the Phase I development of XL309 as a potential therapy for tumors that have become refractory to PARP inhibitor therapy, as well as in combination with PARP inhibitors to deepen and prolong responses. Also, we're pleased with our progress of Phase I trials for XB010 and XL495 and see the opportunity to file up to three new INDs for XB628, XB064, and XB371. We expect a significant number of data presentations for these molecules at major scientific meetings throughout 2025. Business development activities continue to focus on late-stage assets in the GUGI space. Back-end loaded paper success transactions that tuck nicely into our existing and potential future oncology franchise remain a top priority. In terms of capital allocation, we're confident we have the balance sheet and the expected free cash flows to advance our pipeline priorities, access new high conviction assets, and continue to repurchase shares. So with that, please see our press release issued an hour ago for our fourth quarter and full year 2024 financial results and an extensive list of key corporate milestones achieved in the quarter.