Exelixis price target raised to $32 at BofA after ‘long awaited Cabo IP win’

BofA raised the firm’s price target on Exelixis to $32 from $30 and keeps a Buy rating on the shares after a District Court of Delaware court ruled in favor of the validity of Exelixis’ Cabometyx patent covering certain product related salt claims, which was subject to patent challenge by MSN Pharmaceutical. The “long awaited” win means the drug will enjoy market exclusivity until 2030, absent a reversal on appeal, says the analyst, who notes that customarily generics have tended to appeal or enter settlements after negative lower court rulings. However, today’s ruling “most likely eliminates the bull case” of exclusivity until 2031, which would have involved a finding of infringement on Cabo’s formulation patent, the analyst added. The firm is extending Cabo’s exclusivity assumption from January 2030 to mid-2030 in its model, the analyst noted.