Portola Pharmaceuticals Reports Third Quarter 2019 Financial Results and Provides Corporate Update

SOUTH SAN FRANCISCO, Calif., Nov. 5, 2019 /PRNewswire/ -- Portola Pharmaceuticals, Inc.(®) (Nasdaq: PTLA) today reported financial results for the three months ended September 30, 2019, and provided a corporate update.

"We delivered another quarter of strong Andexxa revenue in the U.S. and expanded our growth potential with our first sales of Ondexxya in Europe. The use of Factor Xa inhibitors in both markets continues to grow, driving the underlying market opportunity for Andexxa/Ondexxya and long-term value of Portola," said Scott Garland, Portola's president and chief executive officer. "Looking forward, we will continue to focus on exceptional launch execution, leveraging external support from health authorities and favorable society guidelines, and building the clinical evidence and awareness of Andexxa. In addition, we remain on track to initiate a registration trial for cerdulatinib in early 2020 and will present updated data at the ASH meeting in December."

Product Sales:

    --  Total global revenues for the third quarter of 2019 were $36.8 million
        compared with $14.2 million for the third quarter of 2018. This includes
        $35.7 million in net product revenues from sales of Andexxa/Ondexxya
        [coagulation factor Xa (recombinant), inactivated-zhzo], $17,000 in
        revenues from Bevyxxa(®) (betrixaban) sales and $1.1 million in
        collaboration and license revenues.
    --  Net loss attributable to Portola, according to generally accepted
        accounting principles in the U.S. (GAAP) was $49.6 million, or $0.68 net
        loss per share for the third quarter of 2019, compared with a net loss
        of $71.3 million, or $1.08 net loss per share, for the same period in
        2018.

Operating Expenses:

For the third quarter of 2019, compared to the same period in 2018:

    --  Research and development (R&D) expenses decreased by $14.6 million, or
        36.3%, primarily due to the manufacturing costs for Andexxa Gen 2 being
        capitalized and no longer flowing through R&D.
    --  Selling, general and administrative (SG&A) expenses increased by $13.3
        million, or 34.2%, due to commercial costs to support the Andexxa launch
        including the expansion of the field sales teams and launch preparations
        in Europe.
    --  Cost of Sales (COS) were $2.7 million for the third quarter of 2019,
        compared to $4.3 million for the same period in 2018. This decrease was
        primarily due to transition from our Gen 1 to our Gen 2 Andexxa product.
    --  These amounts on a GAAP and non-GAAP basis are reflected in the table
        below. A table reflecting the reconciliation of GAAP to non-GAAP amounts
        is included at the end of this release.


                                           Three Months Ended September 30,            Nine Months Ended September 30,


                   (In thousands) 2019                            2018           2019          2018

    ---

        Cost of Sales                   $
        2,684                          $
      4,292                              $
      14,825   $
       5,680


        Non-GAAP cost of
         sales                          $
        2,684                          $
      4,292                              $
      10,876   $
       5,680




        Research and
         development
         expenses                      $
        25,647                         $
      40,237                              $
      94,769 $
       166,744


        Non-GAAP research
         and development
         expenses                      $
        21,916                         $
      35,858                              $
      68,358 $
       152,593




        Selling, general and
         administrative
         expenses                      $
        52,050                         $
      38,792                             $
      158,939 $
       110,547


        Non-GAAP selling,
         general and
         administrative
         expenses                      $
        44,735                         $
      31,778                             $
      135,183  $
       89,111




        Totaling operating
         expenses                      $
        80,381                         $
      83,321                             $
      268,533 $
       282,971


        Non-GAAP Total
         operating expenses            $
        69,335                         $
      71,928                             $
      214,416 $
       247,384

Cash, Cash Equivalents and Investments:

    --  Cash, cash equivalents and investments at September 30, 2019, totaled
        $476.8 million, compared with $317.0 million as of December 31, 2018.
        During the third quarter, the Company added net proceeds of $245 million
        in connection with the follow on offering of the Company's common stock.

Recent Achievements and Events

    --  Ondexxya launched with $2.7 million of European net sales in the third
        quarter of 2019.
    --  Andexxa added to the Veteran's Health Administration national formulary,
        making access to 170 VA hospitals across the U.S. possible.
    --  Andexxa recommended as first line therapy by The American Academy of
        Family Physicians (AAFP).
    --  Centers for Medicare and Medicaid Services (CMS) New Technology Add-on
        Payment (NTAP) reimbursement for Andexxa increased from 50% to 65%
        effective on October 1, 2019.
    --  Presented sub-analysis of ANNEXA-4 study at the American College of
        Gastroenterology annual meeting, highlighting the efficacy and safety of
        Andexxa in Factor Xa patients with acute gastrointestinal bleeding,
        which demonstrated excellent or good hemostasis achieved in 82% of
        evaluable patients.
    --  Presented in vitro data at International Society of Thrombosis and
        Hemostasis annual meeting, demonstrating that four-factor prothrombin
        complex concentrate (4F-PCC) does not appear to have an effect on the
        inhibition of thrombin generation by apixaban or rivaroxaban unless the
        Factor Xa inhibitor concentration was less than 75 ng/mL. In contrast,
        data from the same thrombin generation assay demonstrated that Andexxa
        fully corrected the inhibition of thrombin generation by apixaban and
        rivaroxaban across a broad range of inhibitor concentrations.
    --  Net proceeds of $245 million raised in a public offering of the
        Company's common stock.

Planned Upcoming Milestones

    --  Continue launch of Ondexxya in a select group of high-potential European
        countries with significant usage of Factor Xa inhibitors and supportive
        access and reimbursement.
    --  Plan to initiate an urgent surgery study for Andexxa by year end or in
        early 2020.
    --  Plan to launch a cerdulatinib registration study in peripheral T-cell
        lymphoma (PTCL) in early 2020.
    --  Multiple abstracts related to Andexxa and cerdulatinib accepted for
        presentation at the American Society of Hematology annual meeting in
        December.

Analyst and Investor Meeting

Portola will host an analyst and investor meeting focused on Andexxa on Thursday, November 14, 2019, from 8:00 to 10:30 a.m. ET in New York. Seating is limited to those who RSVP. Please contact events@portola.com for an invitation. The event will also be webcast live and can be accessed live on the Investor Relations section of the Company's website at http://investors.portola.com. It will be archived for one year following the date of the event.

Conference Call Details

Portola will host a conference call today, Tuesday, November 5, 2019, at 4:30 p.m. ET, during which time management will discuss the third quarter 2019 financial results, updates on the U.S. and European launch of Andexxa/Ondexxya, and its operations. The live call can be accessed by phone by calling (844) 452-6828 from the United States and Canada or 1 (765) 507-2588 internationally and using the passcode 2980632. The webcast can be accessed live on the Investor Relations section of the Company's website at http://investors.portola.com. It will be archived for 30 days following the call.

Use of Non-GAAP Financial Measures

This press release and the reconciliation table included herein include non-GAAP R&D expenses. The Company believes the presentation of non-GAAP financial measures provides useful information to management and investors regarding the Company's financial condition and results of operations. When viewed in conjunction with GAAP financial measures, investors are provided with a more meaningful understanding of the Company's ongoing operating performance and are better able to compare the Company's performance between periods. In addition, these non-GAAP financial measures are among those that the Company uses as a basis for evaluating performance, allocating resources and planning and forecasting future periods. Non-GAAP financial measures are not intended to be considered in isolation or as a substitute for GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is provided in the accompanying table entitled "Reconciliation of GAAP to Non-GAAP Financial Information."

About Portola Pharmaceuticals, Inc.

Portola Pharmaceuticals is a global, commercial-stage biopharmaceutical company focused on the discovery, development and commercialization of novel therapeutics that could significantly advance the fields of thrombosis and other hematologic conditions. The Company's first two commercialized products are Andexxa [coagulation factor Xa (recombinant), inactivated-zhzo], marketed in Europe as Ondexxya (andexanet alfa), and Bevyxxa (betrixaban). The company also is advancing cerdulatinib, a SYK/JAK inhibitor being developed for the treatment of hematologic cancers. Founded in 2003 in South San Francisco, California, Portola has operations in the United States and Europe.

Forward-Looking Statements

Statements contained in this press release regarding matters that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Such statements include, but are not limited to, statements regarding the anticipated initiation of a registrational trial for cerdulatinib in PTCL, the growing demand for our products, our continued commercial launch for Ondexxya in Europe, our ability to leverage external support from health authorities and build clinical evidence and awareness of Andexxa and our plans to present new data and continue development of our products and product candidates. Risks that contribute to the uncertain nature of the forward-looking statements include: the risk that physicians, patients and payers may not see the benefits of utilizing Andexxa for the indications for which it is approved; our ability to continue to manufacture our products and to expand approved manufacturing facilities; the possibility of unfavorable results from additional clinical trials involving Andexxa; our ability to grow our commercial operations in the EU and generate product revenue within projected timelines and budget; the risk that we may not obtain additional regulatory approvals necessary to expand approved indications for Andexxa; our expectation that we will incur losses for the foreseeable future and will need additional funds to finance our operations; the accuracy of our estimates regarding expenses and capital requirements; our ability to successfully build a hospital-based sales force and commercial infrastructure; our ability to obtain and maintain intellectual property protection for our product candidates; and our ability to retain key scientific or management personnel. These and other risks and uncertainties are described more fully in our most recent filings with the Securities and Exchange Commission, including our most recent quarterly report on Form 10-Q. All forward-looking statements contained in this press release speak only as of the date on which they were made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.


                                                              
              
                Unaudited Condensed Consolidated Statements of Operations




                                                            
             
                
                  (In thousands, except share and per share data)




                                                              Three Months Ended September 30,                                        Nine Months Ended September 30,


                                                  2019                                     2018                                 2019                    2018




     Revenues:



     Product revenue, net                               $
          35,743                                             $
              7,176                                      $
          83,269        $
           10,047


      Collaboration and license revenue          1,056                                      7,001                                             4,123                                 14,785




     Total revenues                            36,799                                     14,177                                            87,392                                 24,832




     Operating expenses:



     Cost of sales                              2,684                                      4,292                                            14,825                                  5,680



     Research and development                  25,647                                     40,237                                            94,769                                166,744


      Selling, general and administrative       52,050                                     38,792                                           158,939                                110,547




     Total operating expenses                  80,381                                     83,321                                           268,533                                282,971




     Loss from operations                    (43,582)                                  (69,144)                                        (181,141)                             (258,139)


      Interest and other income, net             1,953                                      3,924                                             7,958                                  9,123



     Interest expense                         (7,998)                                   (5,957)                                         (23,017)                              (12,642)




     Net loss                                (49,627)                                  (71,177)                                        (196,200)                             (261,658)


      Net (income) loss attributable to
       noncontrolling interest                                                             (126)                                            2,213                                   (17)



      Net loss attributable to Portola                 $
          (49,627)                                         $
              (71,303)                                  $
          (193,987)    $
           (261,675)



      Net loss per share attributable to
       Portola common stockholders:



     Basic and diluted                                  $
          (0.68)                                           $
              (1.08)                                     $
          (2.79)       $
           (3.97)



      Shares used to compute net loss per
       share attributable to Portola common
       stockholders:



     Basic and diluted                     73,017,609                                 66,165,104                                        69,427,124                             65,855,672


                                                   
     
       Unaudited Condensed Consolidated Balance Sheet Data




                                                       
           
                (In thousands)




                                                                                             September 30, 2019                             December 31, 2018



                                                                                           
              
              (Unaudited)



     Cash, cash equivalents and investments                                                                    $
              476,807                     $
        316,964



     Trade and other receivables, net                                                                   18,236                       5,849



     Unbilled - collaboration and license revenue                                                        3,788                       9,880



     Inventories                                                                                         2,357                       7,873



     Property and equipment, net                                                                         4,561                       5,236



     Intangible assets                                                                                   3,699                       7,279



     Other assets                                                                                       67,737                      33,338



     Total assets                                                                                      577,185                     386,419



     Total current liabilities                                                                          87,491                      69,005



     Long-term liabilities                                                                             276,806                     226,847



     Total stockholders' equity                                                                        212,888                      90,567



     Total liabilities and stockholders' equity                                                        577,185                     386,419


                                                                                 
              
                PORTOLA PHARMACEUTICALS, INC.




                                                                    
              
                Reconciliation of GAAP to Non-GAAP Financial Information




                                                                           
              
                (In thousands, except for per share data)




                                                                   Three Months Ended September 30,                                          Nine Months Ended September 30,


                                                        2019                                    2018                                   2019                              2018



                   Reconciliation of cost of
                    sales:



     GAAP cost of sales                                        $
           2,684                                             $
              4,292                                       $
          14,825             $
            5,680



     Gen1 transition                                                                                                                           (3,949)



      Non-GAAP cost of sales                                    $
           2,684                                             $
              4,292                                       $
          10,876             $
            5,680





                   Reconciliation of research and
                    development:


      GAAP research and development                            $
           25,647                                            $
              40,237                                       $
          94,769           $
            166,744


      Stock-based compensation
       expense                                       (3,731)                                  (4,379)                                          (17,437)                                (14,151)


      SRX intangible impairment                                                                                                                 (3,151)


      Equity valuation to
       manufacturer                                                                                                                             (5,824)


      Non-GAAP research and
       development expenses                                    $
           21,916                                            $
              35,858                                       $
          68,358           $
            152,593





                   Reconciliation of selling,
                    general and administrative
                    expenses:


      GAAP selling, general and
       administrative expenses                                 $
           52,050                                            $
              38,792                                      $
          158,939           $
            110,547


      Stock-based compensation
       expense                                       (7,315)                                  (7,014)                                          (23,756)                                (21,436)


      Non-GAAP selling, general and
       administrative expenses                                 $
           44,735                                            $
              31,778                                      $
          135,183            $
            89,111





                   Reconciliation of total
                    operating expenses:


      GAAP total operating expenses                            $
           80,381                                            $
              83,321                                      $
          268,533           $
            282,971



     Gen1 transition                                                                                                                           (3,949)


      Stock-based compensation
       expense                                      (11,046)                                 (11,393)                                           (41,193)                                (35,587)


      SRX intangible impairment                                                                                                                 (3,151)


      Equity valuation to
       manufacturer                                                                                                                             (5,824)


      Non-GAAP total operating
       expenses                                                $
           69,335                                            $
              71,928                                      $
          214,416           $
            247,384





                   Reconciliation of net loss
                    attributable to Portola:


      GAAP net loss attributable to
       Portola shareholders                                  $
           (49,627)                                         $
              (71,303)                                   $
          (193,987)        $
            (261,675)



     Gen1 transition                                                                                                                             3,949


      Stock-based compensation
       expense                                        11,046                                    11,393                                             41,193                                   35,587


      SRX intangible impairment                                                                                                                   3,151


      Equity valuation to
       manufacturer                                                                                                                               5,824


      Non-GAAP net loss
       attributable to Portola
       shareholders                                          $
           (38,581)                                         $
              (59,910)                                   $
          (139,870)        $
            (226,088)





                   Reconciliation of diluted net
                    loss per share:


      GAAP net loss per share                                  $
           (0.68)                                           $
              (1.08)                                      $
          (2.79)           $
            (3.97)



     Gen1 transition                                                                                                                              0.06


      Stock-based compensation
       expense                                          0.15                                      0.17                                               0.59                                     0.54


      SRX intangible impairment                                                                                                                    0.05


      Equity valuation to
       manufacturer                                                                                                                                0.08


      Non-GAAP net loss per share                              $
           (0.53)                                           $
              (0.91)                                      $
          (2.01)           $
            (3.43)





      Shares used to compute loss
       per share                                      73,018                                    66,165                                             69,427                                   65,856




                   Non-GAAP adjustment summary:



     Cost of sales                               
            $                                            
              $                                                            $
          (3,949)    
     $


      Research and development                       (3,731)                                  (4,379)                                          (26,412)                                (14,151)


      Selling, general and
       administrative expenses                       (7,315)                                  (7,014)                                          (23,756)                                (21,436)


      Total non-GAAP adjustments                             $
           (11,046)                                         $
              (11,393)                                    $
          (54,117)         $
            (35,587)

View original content to download multimedia:http://www.prnewswire.com/news-releases/portola-pharmaceuticals-reports-third-quarter-2019-financial-results-and-provides-corporate-update-300952145.html

SOURCE Portola Pharmaceuticals, Inc.®