Exelixis (NASDAQ: EXEL) is a relatively small biotech company with big dreams — to become, as its executives said at a presentation in December, a “top five solid tumor oncology company.”

The company has a blockbuster drug that’s funding its pipeline efforts. Its shares are up more than 20% over the past year and up more than 97% over the past five years.

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There are plenty of reasons why the stock could continue to deliver market-beating returns, the biggest being a growing pipeline that will soon diversify its oncology treatment offerings. Here are three.

Exelixis’ lead drug is cabozantinib — which it sells as Cabometyx and Cometriq. Cabometyx, in tablet form, is a leading therapy to treat kidney cancer, and has also been approved to treat thyroid and liver cancer and advanced pancreatic neuroendocrine tumors. Cometriq is a capsule form of cabozantinib for the treatment of progressive, metastatic medullary thyroid cancer, a particularly aggressive and rare variety.

The drug is also in a phase 3 trial for the treatment of advanced neuroendocrine tumors arising in the lung, thymus, and gastrointestinal tract.

Exelixis likely won’t face generic competition for cabozantinib until early 2031, as it successfully fended off a potential generic rival in a 2024 lawsuit against MSN Pharmaceuticals.

In 2025, Exelixis’ revenue rose 7% to $2.3 billion, most of which came from its cabozantinib franchise. Earnings per share (EPS) were $2.78, up 57.9%. The company is also in the midst of a $750 million stock repurchase program.

On Feb. 2, the Food and Drug Administration approved a New Drug Application for zanzalintinib, in combination with atezolizumab, for patients with previously treated metastatic colorectal cancer. The regulator is due to make a decision on zanzalintinib’s application no later than Dec. 3.

Zanzalintinib is in four phase 3 trials for various cancer types, and is being examined in three early-stage trials as a treatment for different cancers.

Exelixis’ early-stage pipeline also includes antibody-drug conjugates, which combine antibodies that seek out cancer cells with a drug that kills the cells they bind to. These treatments can target cancer cells with high precision.

Exelixis has had success with partnering with other biotech companies. Two of these, Takeda Pharmaceutical and Ipsen, are helping it to sell cabozantinib in Japan.

In January, it announced an agreement with Natera (NASDAQ: NTRA). It will use Natera’s Signatera assay to identify Stage 2 and Stage 3 colorectal cancer patients who are positive for minimal residual disease, in order to enroll them in zanzalintib’s phase 3 Stellar-316 trial, which is expected to begin midway through this year.

Exelixis is also working with Merck (NYSE: MRK) on a phase 3 trial of zanzalintinib in combination with Keytruda to treat head and neck cancer, and in combination with Welireg to treat kidney cancer.

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James Halley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Exelixis and Merck. The Motley Fool has a disclosure policy.

3 Reasons Exelixis Stock Could Deliver Market‑Beating Returns Over the Next Decade was originally published by The Motley Fool