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$6.70 0.19 (2.92%)
7/23/2008 4:00 PM

Exelixis, Inc. (EXEL)

CAPS Rating:
****

A development-stage biotechnology company dedicated to the discovery and development of novel small molecule therapeutics for the treatment of cancer and other serious diseases.

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Avatar chaos1978 (75.24) Submitted: 6/21/07 4:50 AM : Outperform Start Price: $11.42 EXEL Score: -25.98

I like the way Exelixis searches for therapeutic compounds. I had an interview with them a couple years ago, but went down another healthcare oriented avenue (would have been one heck of a commute to work at their greenhouses). The potential for bioprospecting and discovering medicinally useful compounds needs a corporate partner to realize its full potential.

These guys are on the right track to drug discovery. As a company, these guys have done the unthinkable and streamlined drug discovery. Many plants contain bioactive compounds, and both academia and the private sector are not coordinated enough to discover these with the degree of efficiency that Exelixis has demonstrated.

In addition to being a healthcare play, buying stock in this company is also indirectly a green play. Proponents of bioprospecting generally encourage conservation, which is in line with industries developing technologies to enhance recycling and the cost-effective manufacturing of biodegradable products.

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Avatar chaos1978 (75.24) Submitted: 9/01/07 5:35 AM

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Well HologramMan has a point, everyone is looking for the next Genentech and there is a tremendous amount of expectation built into the pricing of most of the biotech stocks out there.

To put it out there, this is one of my "Biotech Billions" picks, and not one I would invest a lot of loot into. I am a science geek by training and like Exelixis's work/culture, but not convinced as an investor that it's worth more than a gamble (say a Benjamin) at this point. Aastrom Bioscience (ASTM) is another of my "Billions" stocks... It's not one I take too seriously as an investment at this point, just b/c they still have so far to go before even approaching profitability.

Viropharma (VPHM) on the other hand, has a patent protected antibiotic found throughout virtually every hospital and pharmacy in the U.S. (think Florida...). I think it's also a large enough business model that it can afford some response to pressure from the likely uprising of prescriptions for generics when they become available. This one is still technically biotech, but not an official member of my club "Billions". Vancomycin is still considered a gold standard and essentially a staple of the healthcare industry. Even if Viropharma can't compete cost-wise, they do have significant agreements established throughout the industry which probably counts for something.

Oooh, almost forgot this one. A very special place in my club is held by Oscient Biopharma (OSCI). No no, not to be confused with the almost profitable Osi Pharmaceuticals (OSIP), but Oscient is what I call a zombie biotech stock. I've listened in on a few of the conference calls and eventually lost interest, but this small investment creeps along in my portfolio, just hovering above that horizontal axis. I learned a little more about the pharmaceutical industry by tracking trends associated with this stock more closely, but the stock has lost ~90% of its value in the last 2 years. It was basically a penny stock when I first laid eyes on it. Their product isn't really that bad at all, though their company board at CafePharma is littered with bad jokes about rashes (one of the observed side-effects). Anyway. I like Exelixis better so I hope it does better, but still definitely a speculative bet.

Happy hunting !

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