Exelixis will move aggressively to independently advance its Phase II EGFR inhibitor candidate, XL647, for treatment of non-small cell lung cancer in light of GlaxoSmithKline's decision not to license the compound.

Exelixis announced July 26 that GSK declined to license the compound after reviewing Phase II data in previously untreated patients with stage IIIB or stage IV NSCLC.

In a same-day conference call, Exelixis CEO George Scangos declined to elaborate on the findings, saying they are scheduled to be released in September at a lung cancer conference in South Korea.

The compound is a small molecule that has been shown to inhibit multiple receptor kinases, including EGFR, VEGFR2, ErbB2 and EphB4.

"I think it is very easy to imagine a scenario where declining ['647] was the best decision for GSK, given their portfolio and what else we have in our collaboration," Scangos said.

The only NSCLC candidate GSK currently has in its internal pipeline is the VEGF inhibitor pazopanib in Phase I.

"It's only natural that the decision will raise some short-term concerns about '647," Scangos added. However, the compound "has an excellent data set."

"We continue to see durable responses in our first-line Phase II trial" in patients with NSCLC, including several durable responses in patients with and without EGFR activating mutations, he noted, adding that the firm will be conducting trials to test '647 to treat breast and other cancers.

The firm plans to take '647 into Phase III clinical trials for NSCLC by the second half of 2008.

Number '647 is the first of potentially 12 compounds that Exelixis can present to Glaxo at the proof-of-concept stage and which Glaxo has the opportunity to license based on a January 2005 development agreement that includes milestone payments worth as much as $275 million for Exelixis.

The compounds declined by Glaxo would net the firm a 3 percent royalty on sales, should they be commercialized by Exelixis, Scangos said.

While Exelixis has made no decision yet whether to commercialize the compound on its own for the North American market, Chief Financial Officer Frank Karbe told investors, "We view this as our most advanced asset, and we'd like to ... potentially make it our first commercial product. I could envision a scenario where we ... partner ... outside the United States and then use the money ... to offset some of the development expenses for North America."

Exelixis' GSK collaboration is similar to one it signed in December 2006 with Bristol-Myers Squibb, allowing Bristol to select up to three drug candidates for codevelopment (¹ Also see "Bristol-Myers Squibb Builds On Exelixis Collaboration" - Pink Sheet, 18 December, 2006.).

A Phase II trial for XL999, an acute myeloid leukemia therapy the biotech is developing with Glaxo, had to suspend patient enrollment in November 2006 due to cardiovascular adverse events (² Also see "Despite Enrollment Suspension, Exelixis Optimistic On XL999" - Pink Sheet, 3 November, 2006.). Exelixis said in April that it will look at XL999 as a treatment for NSCLC (³ Also see "Exelixis Will Proceed With Development Of XL999 In NSCLC Based On Efficacy Data" - Pink Sheet, 24 April, 2007.).

-Pamela Taulbee (p.taulbee@elsevier.com)

GlaxoSmithKline Passes On Option For Exelixis’ XL647 Lung Cancer Candidate

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