Portola Pharmaceuticals Inc (NASDAQ:PTLA) is a $1.17 billion biopharmaceutical company and potential takeover candidate that develops and commercializes therapeutics for patients in the areas of thrombosis, hematologic disorders, and inflammation. In this article, we take a closer look at the company’s recent developments and future prospects. In addition, we are going to assess the hedge fund sentiment towards the company in order to get a better perspective about the company as a long-term investment opportunity.
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Portola Pharmaceuticals Inc (NASDAQ:PTLA) has two major drugs in its pipeline, ANDEXXA (Andexanet alfa), a recombinant protein that is designed to reverse the anticoagulant activity in patients treated with a Factor Xa inhibitor; and Betrixaban, an oral, once-daily Factor Xa inhibitor, which is in Phase III clinical trials for treating venous thromboembolism prophylaxis in acute medically ill patients in-hospital and post discharge. Portola estimates that ANDEXXA has a long term potential market of around $2 billion a year and Betrixaban could have an addressable market opportunity of $3-$4 billion annually by 2020 if successful. Portola also has a third product candidate, Cerdulatinib, an orally available dual kinase inhibitor that is in early stage trials for the treatment of various hematologic cancers and inflammatory disorders.
On February 1, 2016, Portola licensed the commercial rights to ANDEXXA in Japan to Bristol-Myers Squibb and Pfizer Inc. (NYSE:PFE) for $15 million in upfront payments, $90 million in potential regulatory and sales-based milestone payments, as well as double-digit royalties. Portola plans to submit a MAA with the EMA for ANDEXXA in the third quarter of 2016.
On March 24, Portola’s stock fell by 30% after the company released top-line results from a Phase 3 APEX trial of Betrixaban. Although investors sold the stock because they thought the study showed Betrixaban’s efficacy wasn’t superior to the current standard of care, Portola management thought that the study provided, ‘ample evidence to support the submission of an NDA later this year’. In May, management presented the full results of the Phase 3 Apex study of Betrixaban that showed ‘consistent evidence that VTE events can be reduced with betrixaban with no statistical difference in major bleeding between the betrixaban and enoxaparin arms’. Management plans to file an NDA for betrixaban in the U.S. and an MAA for the drug in Europe in the second half of this year.
We discuss Portola further on the next page.
Follow Portola Pharmaceuticals Inc (NASDAQ:PTLA)
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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
