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Exelixis declines despite cancer drug approval

NEW YORK (AP) -- Shares of Exelixis Inc. slipped Friday, a day after regulators approved its thyroid cancer drug Cometriq.

THE SPARK: On Thursday the Food and Drug Administration approved Cometriq as a treatment for advanced medullary thyroid cancer, a positive for Exelixis. But the company's shares may have sold off Friday's because investors, expecting an approval from the FDA, had already run up the stock in advance of the ruling. Shares had gained 10.5 percent in November.

THE BIG PICTURE: Cometriq is the first approved drug made by the South San Francisco, Calif., company. Exelixis is also testing Cometriq, or cabozantinib, a treatment for prostate cancer, and other types of tumors such as kidney cancer.

THE ANALYSIS: Analysts expect Cometriq to win additional marketing approvals. Stifel Nicolaus analyst Joel Sendek said he thinks the drug will eventually be approved as a treatment for prostate cancer, kidney cancer, and liver cancer.

SHARE ACTION: Exelixis stock declined 37 cents, or 7.1 percent, to $4.87 in afternoon trading. The shares have ranged between $4.05 and $6.95 in the last year.