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Exelixis, Inc. Message Board

  • jhsudds jhsudds Dec 1, 2012 5:55 PM Flag

    What do we know now?

    1. We have an approved drug . The importance of this is that now the drug gets into the clinic, oncologists can work with the dosage, side-effects have been clearly demonstrated based on clinical trials to be lessened with lower dosages in the 60 mg range without losing efficacy, and off label usage will increase. Management has demonstrated that they can navigate the legislative landscape .
    2. It is the intent of the management to build Cometriq into a franchise. Talk of selling Exel should stop. In the absence of a hostile takeover , management wants to go it alone. A near term catalyst will be partnering international markets . I am hoping that partner will be Roche…makes sense to me on many levels.
    3. Although the compound may not be used in first line settings, in combination with other compounds, we will see its use across multiple lines of cancer. Some of the best and brightest clinicians and research is in process. I like to think of Cometriq as a new and improved Avastin…one of the best selling onchology compounds in use today. Whereas this is an evolving science as data comes forth, the potential is certainly there to see a multi billion franchise.
    4. We would all like to see sky rocketing share prices, but as a spec stock, until the money is in hand the market these days (versus internet bubble) is unwilling to pay up for potential….bummer but realistic….this is take me to Missouri territory here….patience will win in the end as long as proof of concept continues to be realized. Momentum buyers may or may not realize profit from there trade but will suffer the from the taxes associated with those possible gains….long term investors will win if Cometriq continues to perform. I am encouraged by the data to date, enough so that I added another 10000 shares to my already sizeable position.
    5. IMO Exel should be trading at 6-8 mnimum based on the info at hand. Announcement of a partner may get us there

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    • I agree largely with what you say, but would not discount a takeover bid. Why? Because Big Pharma knows all that you and I and others who have done their DD know, plus much more. Do you actually think with the cash that is in the till, plus the knowledge of the potential and now approved use, that at the discounted cap now they might not take a run trying to get it cheap? I would say, whats to lose on their part, if they like what they see. My point has been this. Either the price rises or somebody tries to grab it, from shareholders willing to take a premium on this discounted price. I consider this an extremely strong buy currently. It was a good buy for the last weeks, but now is a screaming buy, just when some frustrated folks lose perspective and sell. The real action is over the next months in my opinion. Could be at any time, but regardless of exactly when, it will move up, OR as I just said, someone takes a run at it.IMO

      Sentiment: Strong Buy

      • 2 Replies to buysignalinvestments
      • "......would not discount a takeover bid."
        agree - buyout is more likely now than ever. FDA approval puts more pressure on multiple BigPharms to buy - NOW, not later. Majority of risk in purchasing EXEL has been removed and valuation will increase as more data accumulates. the biggest problem now is putting a $$$ value on EXEL - lots of moving parts other than cabo. I don't think management is interested in selling/partnering cabo and keeping the rest. They are looking to sell the entire company with cabo being ~80-90% total valuation, IMO. Putting a $$$ value on cabo is a SWAG at this point and all the BigPharms will have different projections on income. That's where the fun begins. Fireworks begin as soon as one of the Pharms publicly announces a bid.

        btw, it doesn't matter what Dr. Hairdo wants or that EXEL claims they are not for sale. Selling the company is not their decision. it is up to us, the shareholders.


      • Yes stranger things can and do happen. And I am quite suspect that management has received possibly a number of inquiries. It would be unfortunate for management to settle on good rather than better for the smaller gain that would realize for shareholders. Somewhat reading between the lines however, the language MMM uses to describe the future for Exel presently lands on a solid "not for sale" at least at the present time imo. Few years down the road with continued good results and i would not be surprised at all with the announcement " Exel has hired Goldman Sachs in exploring strategic options".....for the moment however, one thing for sure is Exel is undervalued . For now, I am content to let this play out while watching the data closely...I like what i see.

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