Portola Pharmaceutical's AndexXa Approval Remains Uncertain

Portola Pharmaceuticals (NASDAQ: PTLA) long-awaited FDA decision on AndexXa could once again be delayed. On Feb. 28, the company reported on its earnings conference call that the FDA has requested additional information, and this week, at the American College of Cardiology's 67th Annual Scientific Session & Expo., management updated investors on what that request may mean to AndexXa's approval.

A rocky road to regulatory approval

AndexXa is specifically designed to reverse the anticoagulant effects of factor Xa inhibitors, a new class of anticoagulants that are displacing warfarin and racking up billions of dollars in sales in the process.

Factor Xa inhibitors offer advantages to warfarin, including reduced testing and dietary restrictions, but as of now, there aren't any FDA approved antidotes that stop factor Xa inhibitors from working in the event of an emergency surgery or bleeding.

Recognizing the need for a reversal agent, factor Xa drugmakers have collaborated with Portola Pharmaceuticals on AndexXa's clinical development. Specifically, Johnson & Johnson, the manufacturer of Xarelto, and Pfizer and Bristol-Myers' Squibb, which co-market Eliquis, helped fund Portola Pharmaceuticals AndexXa studies.

In those trials, AndexXa significantly reduced the anticoagulant effects of Xarelto and Eliquis, prompting Portola Pharmaceuticals to file for FDA approval in 2016. Unfortunately, rather than giving AndexXa an OK, the FDA issued a complete response letter, rejecting the drug's application. According to Portola Pharmaceuticals, the rejection was based on the FDA wanting more insight into how AndexXa works in factor Xa drugs other than Xarelto and Eliquis. The FDA also wanted more information regarding AndexXa's manufacturing.

It took some time, but Portola Pharmaceuticals felt comfortable enough that it had the answers to the FDA's questions last year. As a result, management refiled AndexXa for an FDA approval in August 2017, restarting the clock on an FDA decision.

However, the FDA's review of AndexXa hit another roadblock in December when the regulator announced it was extending its AndexXa review by 90 days because Portola Pharmaceuticals had submitted additional requested data that was determined to be an amendment to AndexXa's application. As a result, the FDA's decision date on AndexXa was pushed back from Feb. 3, 2018 to May 4, 2018.

Unfortunately, investors found out in February that the additional 90 days might still not be enough time. During the company's fourth-quarter conference call, management disclosed it had received additional requests from the FDA for more information.

Portola Pharmaceuticals didn't go into much detail regarding the information requested during the call, but in an update on March 12, management said the FDA was still considering biomarker reversal and hemostatic efficacy findings from AndexXa's studies. Specifically, it appears regulators are trying to wrap their minds around why data shows that AndexXa produces a nearly 90% reversal in biomarkers, yet 17% of patients still fail or have poor hemostasis, or stopping of blood flow, after receiving AndexXa. The company maintains AndexXa's consistent high-efficacy, including improving mortality, warrants approval, but the FDA could conceivably delay an OK until studies explain this divergence.

An important decision

Xarelto and Eliquis' labels have been expanded to include their use in more patients and new factor Xa inhibitors have also won approval, including Portola Pharmaceuticals' own Bevyxxa. The growing use of factor Xa inhibitors increases the risk that hospitalized patients will require a reversal agent, and thus increases the importance of AndexXa's availability. Over 100,000 factor Xa patients who could benefit from AndexXa are admitted to hospitals annually, according to Portola, and that figure continues to grow as factor Xa's become more commonplace.

The size of this addressable market suggests AndexXa could generate high nine-figure sales if it secures a green light. That's important given it's only recently that Portola Pharmaceuticals began marketing Bevyxxa, and therefore it has little revenue and its still losing money. For now, management says AndexXa's FDA decision date hasn't changed, but given the hedging during Monday's update, I'm not so convinced that a decision will still happen in May. If it doesn't, it could further delay the company's progress toward profitability, so investors will want to keep close tabs on the company's progress.

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Todd Campbell owns shares of Pfizer and Portola Pharmaceuticals. His clients may have positions in the companies mentioned. The Motley Fool owns shares of and recommends Johnson & Johnson. The Motley Fool has a disclosure policy.