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Stocks E / Exelixis, Inc.


Subject:  Re: exel offering Date:  8/8/2012  11:52 PM
Author:  XMFBreakerTinker Number:  458 of 673

It is a go with the FDA. The full data set is still being produced and is not known such as overall survival. But progression free survival, if memory serves (and mine is pretty good) was 27 or 28% for CABO and 0% for placebo.

That is not a fluke. That is efficacy. If that is not efficacy, then we better redefine the term.

MTC is a small market though, and the marketing costs for it will be small. All practitioners for MTC cases will know of it in the U.S. and it will largely be production and distribution issues. Some marketing vs. one competitor that has little to offer efficacy wise. Perhaps it won't match up well in the end, perhap sit will be clearly superior not known. But it does work. And seems to work better than anything else in the indication.

But no, the money will be used for clinical trials for CABO in larger indications. True, there are issues of, will it produce overall survival in these indications, and if so, will there still be room for it as a market leader. The former I believe yes, the latter is what the uncertainty mostly surrounds I think. Time to market. The drug is clearly differentiated, but the uncertainty is, are the bone scans clinically meaningful. Who knows, but it seems quite likely that it is.

The $225 million convertible hits in 2019. That convertible would presently, as of close today, be nearly a 1/3 dilution of the shares. Where as the secondary itself is about 12-13% or thereabouts. By 2019, if Cabo is not on the market for prostate and then another major indication, the drug will have been a total flop anyways. If it is on the market for prostate (even iwthout another major indication) it will have a multi-billion dollar market cap and the 225 million convertible secondary will be small time dilution at that point in time.

Is there something in the contractual terms of the convertible that make its dilutive effect in 2019 much greater than just the $225 million? I have not looked at that detail. Assuming it is just $225 million, it won't be a problem by 2019. And if it is, most of us won't care anyways as Cabo will have been a failure.

Long and short, this sell off does not fully make sense, absence a technical sell off allowing short to get away with it, just as the share price increased as well into it, and outside a 6 month purview is ridiculous.

More so when one figures, as you do, that yes, this is likely the last fund raising event for the company, at least until the share price is much higher on either anticipated or actual drug approval, or bust. One or the other.

Temporarally displaced from the answer.

Just as we are temporally displaced from the election. I won't be here if Obama wins, but just in case Romney does, I'll keep this one bookmarked and see how it turns out on this board.

If Obama wins, I am just cashing out, paying off the house, all the debt, and basically saying screw it. Why even try anymore. Which is what is going to happen in France when they put in the 75% tax rate. If everything is available for free, and if your hardwork is literally stolen like that, then why not just grab a beer, say let the other guy work, and watch the whole system crash around you. Maybe go into politics, as in Obama's America, only politicians are noble, not business people, entrepreneurs, and those that actually produce. They are the oppressors. Sad to say this about any American president, and I never thought we would see the day.
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