Investment Overview

Following approval of Bevyxxa, Portola (PTLA) stated that it expected to launch in the US in the September to November time frame. Subsequently, the Company alerted investors to a manufacturing issue that could delay the launch. During yesterday’s conference call, the Company said that it hopes to be able to launch in November, but also said that the launch could be delayed until 1Q, 2018. It also acknowledged that there is an (unlikely) scenario in which the delay could be longer.

The WAC price of Bevyxxa will be $15 per capsule which I estimate will translated into about $10 on a net basis. This lightly more than the other Factor Xa inhibitors Xarelto and Eliquis. The recommended length of therapy is 35 to 40 days with one capsule so that the revenue per patient treated should be about $350 to $400.

The FDA accepted the AndexXa BLA for review and has set a PDUFA date of February 2, 2018. If the BLA is approved, the US launch could begin in mid-2018

Portola ended 2Q, 2017 with $270 million of cash which management states can fund operations into 1Q, 2018. The Company is going to require a very significant amount of cash to fund the launch of Bevyxxa and AndexXa. It reiterated that it plans to appropriately capitalize the company during 2H, 2017.

The uncertainty on timing of the Bevyxxa launch layers on some uncertainty for investors as does the need for substantial financing in 2H, 2017. While the approval of AndexXa is highly probable in February 2018, it is “never over until it’s over”. I acknowledge that these uncertainties could weigh on the stock in the near term. However, the strong probability of Portola introducing two blockbuster potential drugs in the next year far outweighs these issues and I continue to recommend purchase. Conclusion of the financing, a successful outcome on Bevyxxa allowing for a 1Q, 2018 or earlier launch and approval of AndexXa could trigger a major rally in the stock price over the next half year.