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Expert Financial Analysis and Reporting

Portola: NEJM Report on Positive Results in ANNEXA-4 Study is a Significant Positive (PTLA, Buy, $28.89)


This report focuses narrowly on the New England Journal of Medicine article. If you would like a more thorough discussion on the fundamentals of Portola I suggest that you refer to two recent reports.

Key Points

  • Andexxa (andexanet) is the only approved treatment for reversal of anticoagulant effects of Factor Xa inhibitor drugs like Xarelto and Eliquis whose use can cause life threatening bleeding in a small percentage of patients. These drugs are currently being prescribed to several million patients worldwide which makes Andexxa potentially one of the most medically important drugs introduced in recent years.
  • Because of the urgent medical need, the FDA was willing to approve Andexxa on the basis of a relatively small, non-randomized trial in healthy volunteers. The lack of data in larger trials in patients who actually incurred bleeding while on Factor Xa anticoagulant therapy has produced some uncertainty among physicians in evaluating Andexxa.
  • The February 7, 2019 issue of the New England Journal of Medicine reports encouraging outcomes in the ANNEXA trial which was undertaken in patients who suffered serious bleeds after receiving a Factor Xa anticoagulant, primarily either Eliquis or Xarelto.
  • The publication of this encouraging article in the prestigious NEJM should significantly lessen concerns with the limited clinical data on Andexxa and increase its rate and depth of penetration in the market.
  • Portola’s market research suggests that there are 140,000 hospital admissions each year in the US for excessive bleeding due to anti-coagulants and another 28,000 patients who are on ant-coagulants undergo emergency surgery. At an estimated price of $28,000 per treatment this suggests an addressable market in $5 billion in the US and probably more internationally for reversal agents.
  • Management estimates that in the US the number of those most urgently in need and that can be immediately targeted is about 27,000 which translates into about $750 million of sales. The European market has about the same potential.
  • I think that Andexxa has blockbuster potential so that at peak sales, it could achieve US sales of $1 or $ 2 or more billion dollars and a like amount overseas. Peak sales could occur in five or so years.
  • In terms of valuation, based on looking at multiples of sales that investors often place on emerging biotechnology companies, I think that Portola could be valued at 8 to 10 times revenues. I am anticipating an equity offering in the near term that potentially could increase share count to 70 million shares. These estimates suggest that $1 billion dollars of sales could produce a market capitalization of $8 billion plus and a share price of $114 or more. I think that worldwide sales will substantially exceed $1 billion.
  • I remain a buyer and look forward to the conference call on March 1, 2019 that will provide an update on the sales progress of Andexxa since its May launch.

New England Journal of Medicine Article on the ANNEXA-4 Study

Andexxa is potentially (likely) a breakthrough drug for the reversal of the anti-coagulant effects of Factor Xa inhibitors, most notably Xarelto and Eliquis. These are life saving drugs that are used by several millions of patients throughout the world, but sometimes their mechanism of action (making it more difficult for blood to clot) can cause life threatening bleeds. There is no approved treatment if this occurs, other than Andexxa. It was approved by the Food and Drug Administration (FDA) in May 2018, under its Accelerated Approval Program. The FDA designated Andexxa as a breakthrough drug and its approval was based on a non-randomized study conducted in healthy adults which used Factor Xa inhibition as an endpoint. As a condition of approval, Portola was required to do another post approval study in patients who were actually suffering from severe or life threatening bleeds resulting from the use of Factor Xa inhibitors; this is the ANEXXA-4 study that is the subject of the NEJM article.

Details and Results of the ANNEXA-4 Study

ANNEXa-4 evaluated 352 patients who developed acute major bleeding within 18 hours after administration of a factor Xa inhibitor. Of these patients all 352 were evaluated for safety and 254 who met pre-specified criteria were evaluated for efficacy. The co-primary outcomes were the percent change in anti–factor Xa activity after Andexxa treatment and the percentage of patients with excellent or good hemostatic efficacy at 12 hours after the end of treatment, with hemostatic efficacy adjudicated on the basis of pre-specified criteria. In the efficacy group 79% were being treated for atrial fibrillation and 18% for venous thromboembolism.

A major goal of the study was to show 50% or better hemostasis within 12 hours of the start of therapy. This was significantly exceeded as 82% of patients reached this status. It is important to note that the most serious, life-threatening bleeds that can occur are intra-cerebral and gastrointestinal bleeds. In this study, of the patients who were evaluated for efficacy, 64% were suffering from intracerebral bleeds and 26% were suffering from gastrointestinal bleeds. It is these patients who are most at risk. The percentages of patients with excellent or good efficacy were 80% (95% CI, 74% to 86%) for intracranial bleeding and 85% (95% CI, 76% to 94%) for gastrointestinal bleeding.

Safety Discussion

One of the major theoretical concerns with Andexxa is whether its pro-thrombotics effects might increase the risk of cardiovascular (heart attacks, strokes) mortality or morbidity risk. Bear in mind that the reason patients are given Factor Xa inhibitors is to prevent strokes and heart attacks due to blood clots. If this anticoagulation effect is taken away, physicians are concerned that this could lead to a cardiovascular event. There is no good reason I can think of as to why Andexxa itself would directly cause a cardiovascular events following its use. However, there are inevitably going to be such events as described in the next paragraph.

In ANNEXA-4, there were 34 patients (10%) who had a thrombotic event during the 30-day follow-up period after Andexxa treatment. Of these patients, 11 had an event within 5 days after andexanet therapy, 11 had an event between 6 and 14 days, and 12 had an event between 15 and 30 days. Myocardial infarction occurred in 7 patients, ischemic stroke in 14, and deep-vein thrombosis in 13, and pulmonary embolus in 5.

There were 49 patients (14%) who died within 30 days after enrollment, 35 of cardiovascular causes, 12 of non-cardiovascular causes, and 2 of unknown causes. There are no really good studies in the literature, but the authors did cite one study that indicated a mortality rate of 35% in patients with intracranial bleeds. This suggests but does conclusively show that Andexxa can save lives.

In addition to cardiovascular events, there were 2 patients with infusion reactions, neither of which was severe. Antibodies to Factor X or Xa developed in no patients after andexanet treatment, and no neutralizing antibodies to andexanet developed.

Restarting Anti-coagulant Therapy

Another concern with Andexxa use is whether and how soon patients can resume anti-coagulant therapy. The results of ANNEXA-4 are encouraging although not conclusive. In the 30 days after andexanet treatment, 220 patients (62%) received at least one dose of either parenteral or oral anticoagulant therapy; of these patients, 8 (2%) had a thrombotic event after restarting anticoagulation. Of the 220 patients, 100 (28%) were restarted on oral anticoagulation during follow-up. No thrombotic events occurred after oral anticoagulation had been restarted.

Limitation of ANNEXA-4

The authors said that the most important limitation of this trial is that it did not include a randomized comparison with a control group. At the time of study initiation, it was determined that a randomized, controlled trial would have logistic and ethical challenges, given the perceived risks of placebo assignment in this highly vulnerable population. However, continued use of unapproved agents, despite a lack of rigorous clinical data, has changed the equipoise for a trial. Thus, under the guidance of the FDA and as a condition of accelerated approval in the United States, Portola is conducting a randomized trial ( number, NCT03661528) that is expected to begin later in 2019.

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