Updated with new information.
Cometriq, formerly known as cabozantinib, is the first drug developed by Exelixis to win regulatory approval.
Exelixis shares closed Thursday down 4 cents to $5.24. After a brief after-hours halt, shares fell 3% to $5.13. Cometriq's approval was widely expected.Medullary thyroid cancer (MTC) is a rare and slow-growing form of thyroid cancer that can often be treated surgically. As a result, 500-700 patients in the U.S. per year are likely candidates for Cometriq therapy, said Exelixis management on a Thursday night conference call. The company's MTC market size estimate is smaller than the 2,800-patient estimate derived from American Cancer Society data. Cometriq will cost $9,900 per month. The average MTC patient will likely be on therapy for about 10 months, Exelixis said. Exelixis did not offer sales guidance but a back-of-the-envelope calculation pegs the likely Cometriq U.S. revenue opportunity in the range of $20-40 million at peak. Exelixis is also seeking the drug's approval in Europe, where the MTC market size is similar. A five-person contract sales force will be used to market the drug in the U.S. Cometriq is an oral drug designed to block two major molecular pathways by which tumor cells grow. In the phase III study of advanced MTC patients, treatment with cabozantinib resulted in a median progression-free survival of 11.2 months compared to 4 months for patients treated with a placebo. Cabozantinib reduced the risk of MTC re-growth by 72% compared to placebo. -- Reported by Adam Feuerstein in Boston. Follow @AdamFeuerstein