Seeking to move its late-stage pipeline forward, Exelixis has reorganized operations and is paring back R&D. As part of the move, which will reduce cash expenditures through 2011 by about $90 million, the biotech is trimming headcount 40 percent, or roughly 270 employees, to about 700.

Despite the shift, Exelixis intends to "aggressively advance" three late-stage compounds - XL184, XL147 and XL765 - and will continue to move other candidates into development, although the numbers will be reduced for "the foreseeable future," according to the company.

"We remain enthusiastic about their potential as new anti-cancer agents and have retained the development expertise and capabilities to advance these compounds expeditiously," said George Scangos, the biotech's chief executive, in a statement. He added that Exelixis will attempt to deliver one new IND per year.

"Our priority is to see ourselves through to the anticipated filing of our first NDA for XL184 in the second half of 2011," he continued. "We are convinced that the restructuring is the right step for the company and positions us well to move in the future."

The XL184 compound inhibits three different targets - MET, VEGFR2 and RET - that drive tumor formation, growth and metastasis in a range of cancers, including medullary thyroid cancer, non-small cell lung cancer and glioblastoma, the most common and aggressive form of brain cancer.

The compound is part of a collaboration inked in December 2008 in which Bristol-Myers Squibb agreed to pay up to $240 million for development and commercialization rights for that and one other compound (Also see "Love The One You’re With: BMS Pays Exelixis $240M Upfront In New Cancer Drug Deal" - Pink Sheet, 12 December, 2008.).

The deal came right after GlaxoSmithKline declined an option to license XL184 and four earlier-stage compounds, because XL184 overlapped with a competing compound owned by the big drug maker (Also see "GSK/Exelixis: The End of an Era" - Pink Sheet, 24 October, 2008.).

As of Sept. 30, 2009, Exelixis had $170.6 million in cash and cash equivalents, and another $115.7 million in marketable securities. The company expects to record a restructuring charge of about $15 million in the first quarter of 2010, although the amount may increase.

-Ed Silverman (e.silverman@elsevier.com)

Exelixis Reorganizes R&D And Cuts Its Workforce By 40 Percent

More from Archive

More from Pink Sheet