This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Biotech Stock Mailbag: Exelixis, Protalix, Arena

BOSTON ( TheStreet) -- David Sobek, political scientist, amateur biotech investor and widely followed Twitter commentator (@dsobek) writes that Exelixis (EXEL) is an under-appreciated and under-valued biotech stock, particularly given some updates on the prostate cancer drug cabozantinib expected at the American Society of Clinical Oncology (ASCO) annual meeting in June.

"[Exelixis] represents both a long-term value play and has a good chance to surprise investors with their data presentations at ASCO," writes Sobek at Seeking Alpha.

I appreciate Sobek's perspective on Exelixis but told him ( via Twitter) that he's fighting against Wall Street biotech investors and their generally dim view of cabozantinib's potential. That makes it tough for Exelixis bulls like Sobek to win.

Exelixis shares were trading around $12 in the run up to last year's ASCO meeting but have since slumped to less than $5. To help explain why Exelixis has fallen and isn't getting up anytime soon (say the bears), I've asked a veteran Wall Street biotech investor -- and a longtime source -- to lay out his negative thesis for cabozantinib in this week's Biotech Stock Mailbag. His job prevents him from going on the record, so let's just call him Bio-investor X. And while he's not short Exelixis, you can assume that he's in the short-selling camp on this stock.

Remember, every stock -- biotechs included -- has a bull and bear thesis. You can't make an informed investing decision without knowing what the other side thinks.

As background, Exelixis is conducting two phase III studies of cabozantinib ("cabo" for short) in advanced prostate cancer. The company's plan is to use data from both studies to seek regulatory approval.

Study 306 is designed to assess durable pain reduction, currently enrolling prostate cancer patients with progressive disease (bone pain) after treatment with Taxotere and either Johnson & Johnson's (JNJ) Zytiga or Medivation's (MDVN - Get Report) MDV3100 . The study's targeted enrollment is 236 patients who are randomized 1:1 to receive either cabo or mitoxantrone/prednisone.

Study 307 is the survival trial and will enroll the same type of prostate cancer patient (post Taxotere and either Zytiga or MDV3100), randomized 2:1 to receive either cabo or prednisone. Target enrollment is 960 patients. An interim analysis of survival will be conducted after 387 deaths, a final analysis at 578 deaths.
1 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
ALXA $1.24 0.00%
ARNA $2.19 0.00%
EXEL $5.98 0.00%
MDVN $41.26 0.00%
PLX $1.13 0.00%


Chart of I:DJI
DOW 17,084.49 +33.74 0.20%
S&P 500 2,014.89 +15.91 0.80%
NASDAQ 4,830.47 +19.6820 0.41%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs