Here’s Why Smart Money Investors Are Betting on Portola Pharmaceuticals

On August 18, Portola suffered a major setback after the FDA rejected the company’s BLA submission for ANDEXXA. In the complete response letter for ANDEXXA, the FDA requested Portola provide additional information mostly related to manufacturing. The agency also asked for additional information to support inclusion of enoxaparin and edoxaban in the label, and indicated the agency needs to finalize its review of the clinical amendments to Portola’s post-marketing commitments.

Fortunately, the FDA CRL letter isn’t a death sentence for the company. As of June 30, 2016, Portola had cash, cash equivalents and investments of $353.6 million and Portola management intends to ‘meet with the FDA as soon as possible’ to restart the approval process. If the BLA is approved and ANDEXXA becomes a billion dollar a year drug, Portola shares have substantial upside from current levels.

In terms of hedge funds, it seemed that the smart money was more circumspect in the second quarter. Of the around 750 funds that Insider Monkey tracks, 17 investors had a bullish position in Portola Pharmaceuticals Inc (NASDAQ:PTLA) at the end of June, down by eight funds from the previous quarter.

Disclosure: none