Good day, ladies and gentlemen, and welcome to the second quarter 2010 Exelixis earnings conference call. My name is Amanda and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will facilitate a question-and-answer session towards the end of today's conference. (Operator Instructions) At this time, I would like to turn the call over to your host for today, Mr. Charles Butler, Vice President of Investor Relations. Please proceed, sir.

So thank you for joining us on the Exelixis second quarter 2010 earnings call. Joining me on today's call are Mike Morrissey, our new President and CEO; Frank Karbe, our CFO who will both jointly review our corporate, financial, and development progress for the quarter ended June 30, 2010. They will also discuss upcoming objectives and provide an update on XL184, our lead clinical development program. As a reminder, we are reporting our financial results on a GAAP basis only and as usual, the complete press release with our results can be accessed through our website at exelixis.com. Before we get started, I would like to note that during this presentation and question-and-answer session today, we will be making certain statements that are forward-looking, including and without limitation statements related to the future development of XL184 and our plans related to HER2 [ph], the therapeutic and commercial potential of XL184, data to be presented at EORTC in November 2010, expectations regarding development activities, and our 2010 financial outlook. These statements are only predictions and are based upon current assumptions and expectations. Our actual results and the timing of events could differ materially from those anticipated in such forward-looking statements because of risks and uncertainties discussed in the presentation materials, the comments made during this presentation, and the Q&A session, and the Risk Factors section of our 10-Q for the quarter ended July 2nd, 2010, and our other reports filed with the Securities and Exchange Commission. We expressly disclaim any duty to make any updates or revisions to any forward-looking statement. With that, I will turn the call over to Mike.

Thanks, Charles and thanks to everyone joining us on the call today. As most of you know, I officially became CEO of Exelixis just over two weeks ago on July 15th. I'm taking this position at a turbulent time and I'm excited to lead the company with a clear sense of focus, urgency, and transparency as we advance our key compounds into late-stage development and potential commercialization. The stability of our senior management and the collaborative approach of our Board remain at the core of the company. We have been working together as a team for many years and we will continue to do so. Despite our recent challenges, we remain focused on advancing XL184, which has generated encouraging early clinical data in a variety of tumor types, including some with significant commercial potential. While we have numerous other compounds advancing in the clinic, including the PI3K inhibitors XL147 and XL765 with sanofi, our most important near-term objective is to generate additional clinical data that will enable us to concisely frame the near-term development and commercial opportunities for XL184. While we readily acknowledge the concerns that are shared by many investors about regaining the rights to XL184, we are optimistic that this compound can serve as a potential catalyst for building positive momentum as new data become available from the randomized discontinuation trial or RDT study in the fall. I'll state here and now that we are moving forward with a renewed sense of urgency and commitment in order to execute on our key next steps in a thoughtful and pragmatic manner. We made significant progress on the XL184 development program since our most recent update in June. Our near-term plans, which we presented at ASCO, are based on sound clinical developments and commercial rationale and consist of three main…

Thanks, Mike. Starting on this call, we will change the format of the financial section of our prepared remarks. The objective of the change is to streamline this part of our call and make it easier to follow and more focused on the highlights of our financial performance in the quarter. I will refer you to our press release and quarterly SEC filings for additional detail. And of course, we can address the questions during the Q&A portion of this call as well. From a financial perspective, we had a very positive second quarter, as a result of implementing the financial strategy we announced last year. The impact of our partnering, cost containment and financing activities is now becoming clearly visible in the improvements of our financial performance. Revenues are up almost 75% over Q2 last year, mainly due to our new collaboration with sanofi-aventis around some of our PI3K assets and to a lesser degree, due to increased reimbursements from our collaborations with BMS. R&D expenses are down slightly despite significant progress of our late-stage clinical development activities for XL184, mainly due to cost containment efforts which includes most notably, our reduction in force in March of this year. And as a result, our net loss decreased by 50% from the same quarter last year despite approximately $9 million in further restructuring charges this quarter, which were primarily related to successfully subleasing our largest building to ONYX Pharmaceuticals. And lastly, we had over $200 million in cash inflows during the second quarter, which includes approximately $160 million from our financing transactions with Deerfield and Silicon Valley Bank, as well as almost $40 million from all collaborations. This brings our cash balance to close to $310 million at the end of Q2. So overall, we are pleased with the progress…

Okay. Thanks, Frank. So we will close here by thanking all of our employees for their resilience during the last few months. Their continued hard work and dedication are reflected in our organization and our progress on a daily basis. We look forward to updating you on our progress on our next call. And at this point, we would be happy to take any questions. Operator?

Thank you, sir. (Operator Instructions) Your first question comes from the line of Joel Sendek of Lazard Capital Markets. Please proceed, sir. Joel Sendek – Lazard Capital Markets: Hi, thanks a lot. So – let's see, I going to try to ask all my questions all wrapped up into one. And it has to do with the partnering, as well as the financial guidance, as I am a little bit – I guess I am a little bit confused. Is the – do you have any update on the timeline for partnering 184 and is that impacting the newer revenue guidance at all, which seems to have to do with future business development activities or are they two separate things? Thanks.

Yes. Joel, this is Mike. Those are two separate issues. The analysis of the 184 plan that's underway now by the senior management team and the Board will analyze all the components of the 184 world, including the data, commercial potential, obvious – potential partnering scenarios, finances, regulatory strategies, all of that holistically is being reviewed in one analysis that's ongoing right now. The updated guidance that Frank can speak to does not include that at the present time. You want to –? Joel Sendek – Lazard Capital Markets: Okay. That's great. I totally understand now then in that regard. But actually before, Frank, you go forward, I just want to ask a follow-up question on what you just said, Mike, with regard to this process on 184. I mean, presumably there is data that you don't know yet or at least that we don't know yet that will be at EORTC. To what extent are you waiting to get more data from the randomized discontinuation trial before you come into a conclusion on that 184 partnering plan analysis?

Yes. We are getting regular daily, if not more frequent, updates on the trial. So we have a lot of additional data based upon what we talked about with the early dataset that was presented in June at ASCO. So we expect to have a lot more data certainly in the November time frame in terms of both depth and breadth. We have the flexibility to look again, broadly at different scenarios in the context of data that we have between June and now and then now going forward. So it's a fluid process, the data that we see on a regular basis is certainly informing us about where we have a novel and differentiated signal and that certainly is going into our current analysis right now. Joel Sendek – Lazard Capital Markets: Okay. Thanks.

Your next question comes from line of Ted Tenthoff of Piper Jaffray. Please proceed. Ted Tenthoff – Piper Jaffray: Great. Thank you very much. And Mike, I just want to say congratulations on assuming the role. I think you can be a great CEO and really look forward to see your fingerprints on the company and on the compounds. Just I guess picking back up with 184, I know we are either just at or pretty close to a submission date for EORTC. But just run us back through what we should be expecting in terms of data this fall. And how – obviously, the focus is on 184 here, but I want to ask kind of what other assets are, in your view, kind of partnerable now? Does the fact that Bristol returned 184 – you got 184 back kind of heightened the need to out-license those or maybe decrease the focus on some of those other assets?

So in the context, first, of the EORTC topic, so again, we submitted six abstracts for the meeting in November. All of those six abstracts were focused on the RDT study for 184, all six have been accepted. We will have one abstract that covers the broad trial design in update across all nine tumor types and then we will have one abstract covering each of melanoma, non-small cell lung cancer, hepatoma, ovarian and prostate cancer. So we will have an opportunity to do a very deep data release and dive into the dataset that we have in the fall time frame. And again, as I mentioned on the script, we have expanded those five cohorts recently, enrollment has gone well. So my expectation is that we will have a pretty interesting dataset to be able to share with the community to update people on the progress. And again, the signals that we saw at ASCO that would now be certainly more involved over the next four or five months. The next question was around what other aspects we have to partner. Again, we are engaged in – (Multiple Speakers). Yes, we are engaged in a variety of discussions for both compounds and capabilities in terms of new business development. Those are maturing as we would expect. Certainly, we have got compounds in the clinic, compounds that are in preclinical and our core discovery preclinical capabilities that can deliver INDs in a very high-quality, rapid rate. So – now, I guess I don't want to give too much information on what those discussions are going – those are going right now and what's kind of on the docket, but to say that we are confident that we will have at least one deal in the back half of 2010. Ted Tenthoff – Piper Jaffray: Great. Good luck and let us know how we can help.

Okay. Thank you.

Your next question comes from the line of George Farmer of Canaccord. Please proceed, sir. George Farmer – Canaccord: Hi, thanks for taking my question. Frank, regarding the guidance again, so we should think about booking all that $17 million that you are expecting from BMS in the third quarter, is that correct?

Yes, that is correct. George Farmer – Canaccord: Okay. And then this revised cash guidance – I guess maybe Mike answered that in the last question. The – your previous guidance you said was – I think the last time we met, you said was dependent on concluding business development activity this year. That is still your plan, correct? And you also are including the debt repayment to GSK in the fourth quarter?

Yes. That is correct. George Farmer – Canaccord: Okay.

Our guidance still assumes that we repay GSK in cash. And I will echo what Mike said earlier. We do expect to sign at least one deal before the end of the year. George Farmer – Canaccord: Okay. And then do you need to partner 184 before you go into your GBM registration studies?

The plan that we outlined at ASCO, the short-term plans to finish the 301, the MTC trial, initiate the GBM pivotal trial, and then to expand the RDT trial. So that core set of short-term objectives is operational and is – and remains a clear focus for us in the short term outside of any BD we would do with XL184. George Farmer – Canaccord: Okay.

Yes. Again, I want to reiterate; with the numbers that Frank gave, we are in a solid financial position in the near term. We have time and we have room to be able to put together a very thoughtful and pragmatic plan for how we are going to deal with 184 going forward. We don't want to rush that. We want to do this in a very detailed, thoughtful, thorough sort of way. So we have got the cash to be able to move in the short term and we have got some time to be able to figure out the right plan going forward. George Farmer – Canaccord: Okay. And then just thinking about the organization of senior management at Exelixis, now with your new role, do you intend to bring in anyone to replace your old role or do you think you can multitask and do it all by yourself?

Absolutely not. We have extremely strong R&D team in place. Gisela Schwab, our CMO, will be taking over all the responsibilities for Drug Development, including Developments and then CMC, as well as Translational Medicine will report into her. Peter Lamb, our CSO, who has been with the company from 2000 will now be responsible for all of Drug Discovery, including his old responsibilities in Discovery, as well as Medicinal Chemistry. So my two main direct reports in my old role have now stepped up, joined the senior management team, and will be responsible for R&D. George Farmer – Canaccord: Great. All right. Thanks very much for answering the questions and congratulations again, Mike, for your new position.

Thanks, George.

(Operator Instructions)

Okay. Well, if there is no further questions, then I want to thank everybody for joining us on the call today and we will look forward to our next earnings update in the fall. Thanks again.

This concludes today's presentation. You may now disconnect. Have a good day.