Exelixis Inc. will launch a phase III study in mid-2026 with Merck & Co. to test its cancer drug zanzalintinib in combination with Keytruda, targeting a high-risk colorectal cancer population and expanding its late-stage pipeline.
The collaboration adds external validation to the zanzalintinib program, which represents the company's most significant near-term catalyst to diversify beyond its blockbuster drug, Cabometyx. Year to date, Exelixis’ shares have risen 11.1 percent.
Under the agreement, Exelixis will sponsor the STELLAR-316 study, while Merck will supply its subcutaneous version of Keytruda. The trial will enroll patients with resected stage II/III colorectal cancer who test positive for molecular residual disease (MRD+), a group with substantial unmet need. Natera Inc. will provide its Signatera assay to identify these MRD-positive patients for the study.
This collaboration is crucial for Exelixis as it seeks to develop new revenue streams ahead of the patent cliff for its main drug, Cabometyx, which is expected around 2030. A separate application for zanzalintinib in metastatic colorectal cancer is already under review by U.S. regulators, with a target action date of December 3, 2026.
Zanzalintinib, an oral kinase inhibitor, is central to Exelixis's strategy to reduce its dependence on Cabometyx, which is currently the top-prescribed tyrosine kinase inhibitor for renal cell carcinoma. While Cabometyx is expected to generate over $2.5 billion in revenue for fiscal year 2026, its patent expiration by 2030 creates long-term revenue risk.
The company is pursuing multiple indications for zanzalintinib, including ongoing trials in renal cell carcinoma, neuroendocrine tumors, and lung cancer. A potential approval for the drug in previously treated metastatic colorectal cancer, in combination with Roche's Tecentriq, could be the first step in establishing it as a new growth pillar. Some analysts project zanzalintinib could achieve peak sales of $5 billion.
The collaboration with Merck for the STELLAR-316 study de-risks the development path and accelerates the timeline for another significant market opportunity. Success in the trial would position Exelixis with a multi-billion dollar franchise to succeed Cabometyx and support its stock performance through the end of the decade.
This article is for informational purposes only and does not constitute investment advice.
