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sanjeri/E+ via Getty Images Update 8:15pm: Adds Exelixis comment. Exelixis (NASDAQ:EXEL) had a mixed ruling in its Cabometyx patent trial versus MSN Laboratories. Exelixis rose 2.8% in after hours trading. The judge in the patent case ruled that the 776 patent, which goes to October 2030, wasn’t infringed, a defeat for Exelixis. On the 473 patent, the judge ruled that the patent was valid, according to the court opinion by Judge Richard Andrews. The 473 patent is valid until August 2026. “We are pleased the court upheld the validity of Exelixis’ cabozantinib compound patent,” Jeffrey Hessekiel, Exelixis’s general counsel said in a statement. “While we are disappointed with the court’s decision concerning infringement of the ’776 patent, we remain confident in the strength of the cabozantinib patent estate.” The judge’s opinion seems to be mainly expected after the trial was held in May. The judge at the time appeared to telegraph the ruling he would make, traders said at the time, citing comments at the court hearing. Exelixis (EXEL) shares fell 11% on May 19 on the last day of the trial. As a result of the ruling, Exelixis intends to request that the District Court order that the effective date of any potential U.S. regulatory approval of MSN’s generic product, subject to any appeals or challenges, would be no earlier than Aug. 14, 2026, which is the expiration date of Exelixis’ ‘473 patent. “While we caution that patent litigation for Cabometyx may be a near-term (1Q23) overhang, we are optimistic of an eventual victory in 2024,” Truist analyst Asthika Goonewardene, who has a buy rating and $32 price target wrote in a note last Friday. JMP Securities analyst Silvan Tuerkcan also opined on EXEL’s patent case in a note Thursday before the judge’s decision was released. Tuerkcan has a market outperform and $24 price target on EXEL. “Our base case assumption is that litigation will depend on the newer trial slated for 2023 with a verdict in 2024,” Tuerkcan wrote. “However, reduction in uncertainty with the first decision should help the stock, in our view.” Trial in MSN II is scheduled to begin in October 2023 in the U.S. District Court for the District of Delaware. Last Monday Exelixis (EXEL) reported that it sees Q4 revenue revenue of $415M and issues FY23 guidance.

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