Disappointment and doubt about Exelixis' (EXEL) - Get Exelixis, Inc. Report prostate cancer drug cabozantinib are weighting heavily on the stock Wednesday.

Exelixis shares are down 35% to $4.14 after independent data monitors concluded a closely watched phase III study of cabozantinib in advanced prostate cancer should continue  to the final analysis expected later this year. That's a disappointing outcome for some investors who hoped/expected the cabozantinib study to be stopped for positive efficacy at the interim analysis.

Phase III studies of competing prostate cancer drugs like Johnson & Johnson's (JNJ) - Get Johnson & Johnson (JNJ) Report Xytiga and Medivation's (MDVN) Xtandi were stopped early for positive efficacy, adding to concerns about Exexlis and cabozantinib. 

The phase III study -- dubbed Comet-1 -- enrolled more than 960 men with metastatic prostate cancer no longer responding to docetaxel and either Xytiga or Xtandi. The men were randomized to receive cabozantinib or prednisone, a steroid. The primary endpoint of the study is overall survival. Today's interim analysis was conducted after 387 deaths. The final analysis will be performed after 578 deaths, expected in the middle of the year. 

J.P. Morgan's Cory Asimov on today's news:

TheStreet Recommends

Based on the totality of Phase 2 data (which we think clearly indicates the drug is active) and the assumptions used to power COMET-1, we think COMET-1 could still work. However questions around dosing, contamination from additional treatments post progression, and lack of details on the trial progress relative to expectations muddy the waters, in our view. Further, this interim look has a somewhat negative read-through to the final outcome on a relative basis given other pivotal trial in CRPC (e.g. Zytiga, Xtandi, Xofigo) were stopped early for efficacy. We think it likely that the prednisone arm is performing better than expected (e.g. patients could have progressed more quickly on pred alone and gone on to additional treatments/trials), which could have a significant effect on trial statistics.

Exelixis is conducting a second phase III study of cabozantinib in prostate cancer dubbed COMET-2. The company also has economic rights under a partnership with Roche developing the MEK inhibitor cobimetinib. Results from a phase III study of cobimetinib in melanoma are expected later this year. 

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;

click here

to send him an email.