Exelixis launches follow-on offering of 9 million shares via Goldman Sachs

By Ronda Fears

Memphis, Sept. 27 - Exelixis, Inc. launched after Wednesday's close a follow-on offering of 9 million shares via bookrunner Goldman, Sachs & Co.

Cowen & Co. LLC is joint lead manager. Banc of America Securities LLC and Piper Jaffray & Co. are co-managers.

There is a greenshoe for another 1.35 million shares available.

Exelixis shares (Nasdaq: EXEL) closed Wednesday up by 5 cents, or 0.56%, at $9.05 and in after-hours activity, on word of the deal, dropped sharply. At 4:46 p.m. ET, the stock was seen at $8.50 but traded in extended hours as low as $8.35, a sellside trader said.

Proceeds will be used for research and development and for general corporate purposes, the company said.

South San Francisco, Calif.-based Exelixis is principally focused on cancer, renal disease and various metabolic and cardiovascular disorders with several products in various stages of clinical trials. The company has collaborations with GlaxoSmithKline plc, Bristol-Myers Squibb Co., Helsinn Healthcare SA, Wyeth and Genentech, Inc.

Exelixis on Aug. 31 filed an Investigational New Drug application at the Food and Drug Administration for XL228, a novel anticancer compound designed to inhibit the insulin-like growth factor type-1 receptor (IGF1R), Src and Abl tyrosine kinases.

The company at that time said the XL228 was the first of three IND applications it expected to file by year-end. XL228 was the company's eighth compound to advance to an IND filing.

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