Will Zanzalintinib Ease Out EXEL's Reliance on Cabometyx for Growth?

Exelixis (EXEL) is developing zanzalintinib — a next-generation oral investigational tyrosine kinase inhibitor (TKI) — which inhibits the activity of receptor tyrosine kinases implicated in cancer growth and spread, including VEGF receptors, MET, AXL and MER.

The recent data readout from studies on zanzalintinib has been positive.

In June 2025, EXEL announced positive top-line results from the late-stage STELLAR-303 study. This phase III study is a global, multicenter, open-label study that randomized 901 patients equally to receive either investigational TKI zanzalintinib (100 mg) in combination with Tecentriq (atezolizumab) or Stivarga (regorafenib). The study includes patients with previously non-microsatellite instability-high metastatic colorectal cancer.

The STELLAR-303 study met one of its dual primary endpoints, demonstrating a statistically significant improvement in overall survival (OS) for the intent-to-treat (ITT) population when treated with zanzalintinib in combination with Tecentriq compared with the current standard-of-care drug, regorafenib.

Exelixis stated that the trial will continue to a final analysis of the second primary endpoint — OS in the subgroup without liver metastases (non-liver metastases or NLM).

Enrollment in the STELLAR-304 study was completed in May 2025. This phase III study is evaluating zanzalintinib in combination with Bristol Myers’ (BMY) Opdivo (nivolumab) versus sunitinib in previously untreated patients with advanced non-clear cell renal cell carcinoma (nccRCC).

However, Exelixis has decided not to proceed to the phase III portion of the STELLAR-305 trial on zanzalintinib. The decision was based on the company’s evaluation of emerging data from the phase II portion of the STELLAR-305 trial in advanced squamous cell carcinoma of the head and neck, emerging competition in this indication, and assessment of other, potentially larger, commercial opportunities.

EXEL also initiated the phase III STELLAR-311 study in advanced NET. This study is evaluating zanzalintinib versus everolimus as a first oral therapy in patients with advanced NET, regardless of the site of origin.

EXEL is solely dependent on lead drug Cabometyx for growth and the successful development of zanzalintinib will be a significant boost for the company.

Competition for EXEL’s Cabometyx

The competitive landscape for RCC is evolving rapidly, given the entrance and increased adoption of immunotherapy-TKI combination therapies into the RCC treatment landscape, particularly in the first-line setting.

Lead drug Cabometyx faces stiff competition in the RCC space from the combination of Merck’s (MRK) Keytruda (pembrolizumab) and Pfizer’s (PFE) Inlyta (axitinib) and the combination of BMY’s Yervoy (ipilimumab) and Opdivo.

In 2019, the FDA approved MRK’s Keytruda in combination with PFE’s Inlyta for the first-line treatment of patients with advanced RCC.

On a standalone basis, Keytruda is indicated for the adjuvant treatment of patients with RCC at intermediate-high or high risk of recurrence following nephrectomy, or nephrectomy and resection of metastatic lesions.

Keytruda is currently approved for several types of cancer and alone accounts for around 50% of MRK’s pharmaceutical sales.

Pfizer’s Inlyta is also approved in combination with Bavencio (avelumab) for first-line treatment of patients with advanced RCC.

BMY’s Opdivo and Yervoy are also approved for several oncology indications.

EXEL’s Price Performance, Valuation & Estimates

Shares of the biotech company have gained 14% year to date against the industry’s decline of 0.9%.

From a valuation standpoint, EXEL is expensive. Going by the price/sales ratio, its shares currently trade at 4.09x forward sales, higher than its mean of 3.64x and the biotech industry’s 1.59x.

The bottom-line estimate for 2025 has risen from $2.64 to $2.68, while that for 2026 has decreased to $3.09 from $3.13 over the past 30 days.

EXEL currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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