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Exelixis Announces Settlement of Dispute with Genentech Regarding Companies’ Collaboration Agreement for Cobimetinib

Exelixis, Inc. (EXEL) announced today a settlement of the company’s dispute with Genentech, a member of the Roche Group, concerning the parties’ collaboration for the development and commercialization of cobimetinib, which is marketed as COTELLIC®. Effective July 1, 2017, as part of the settlement the companies entered into an amendment (the “Amendment”) to the existing Collaboration Agreement, dated December 22, 2006, to revise the revenue and cost-sharing arrangements for the collaboration. The Amendment resolves the companies’ dispute pursuant to the arbitration demand filed on June 3, 2016, and aligns both companies’ interests in advancing cobimetinib as a promising therapy for patients with multiple forms of cancer.

The Amendment applies to COTELLIC®’s initial commercial application in combination with ZELBORAF® (vemurafenib), as well as future commercial uses of COTELLIC®, alone or in combination. Under its terms, Exelixis continues to be entitled to an initial equal share of U.S. profits and losses, which will decrease as sales increase as specified in the original 2006 agreement. However, effective as of July 1, 2017, the revenue applied to the profit and loss statement for the COTELLIC® collaboration (“the Collaboration P&L”) will be calculated using the average of the quarterly net selling prices of COTELLIC® and any additional branded Genentech product(s) prescribed with COTELLIC®. Exelixis will continue to share...