Portola Pharmaceuticals Reports Fourth Quarter and Year-End 2016 Financial Results and Provides Corporate Update
Tuesday, February 28, 2017 4:45:38 PM ET
Portola Pharmaceuticals, Inc. (PTLA ) today provided a corporate update and reported its financial results for the fourth quarter and year ended December 31, 2016.
"We are working towards gaining approval of both betrixaban, our investigational oral Factor Xa inhibitor, and andexanet alfa, our investigational antidote for oral Factor Xa inhibitors, in the United States and Europe over the next year," said Bill Lis, chief executive officer of Portola. "Each has the potential to become the first product approved for their respective indications and both are highly anticipated by the medical community. We are confident in the robust clinical data for both products, and are focused on addressing the regulatory risks that remain."
Recent Achievements, Upcoming Events and Milestones
Betrixaban - an oral Factor Xa inhibitor anticoagulant in development for extended prophylaxis of venous thromboembolism (VTE) in acute medically ill patients with risk factors for VTE; designated Fast Track status by the U.S. Food and Drug Administration (FDA)
-- The FDA accepted the New Drug Application (NDA), granted priority review, and established a Prescription Drug User Fee Act (PDUFA) action date of June 24, 2017
-- FDA informed Portola at the mid-cycle review that it does not plan to schedule an Advisory Committee meeting to discuss the NDA
-- The European Medicines Agency (EMA) validated the Marketing Authorization Application (MAA) under a standard 210-day review period; the Committee for Medicinal Products for Human Use (CHMP) opinion is expected by the end of the year
AndexXa(TM) (andexanet alfa) - a Factor Xa inhibitor antidote in development for patients treated with a Factor Xa inhibitor when reversal of anticoagulation is needed due to life-threatening or uncontrolled bleeding; designated a Breakthrough Therapy and an Orphan Drug by the FDA
-- Expanded the existing agreement with Daiichi Sankyo; Portola received a $15 million upfront payment and is eligible to receive up to an additional $10 million upon meeting certain milestones; upon AndexXas approval, Daiichi will be eligible to receive a capped royalty
-- Resubmission of the Biologics License Application (BLA) is anticipated in the second quarter of 2017
-- Continued to enroll patients in the ongoing Phase 3b/4 ANNEXA-4 Study in patients with acute major bleeding; the Data and Safety Monitoring Board (DSMB) successfully completed its third review
Cerdulatinib - an oral, dual Syk/JAK inhibitor in development to treat resistant or relapsed hematologic cancer patients
-- Continued to enroll patients in a Phase 2a study evaluating the safety and efficacy of cerdulatinib in patients with relapsed/refractory B-cell malignancies who have failed multiple therapies
-- Entered into an exclusive worldwide licensing agreement with Dermavant Sciences for the development and commercialization of cerdulatinib in topical applications beyond oncology; Portola retains full rights to all non-topical formulations of cerdulatinib, including oral formulations
-- Entered into a $50 million loan agreement with Bristol-Myers Squibb Company and Pfizer Inc. for continued development and clinical studies of andexanet alfa
-- Entered into a $150 million royalty agreement in the first quarter of 2017 with HealthCare Royalty Partners in exchange for a tiered, mid-single-digit royalty based on worldwide andexanet alfa sales
Fourth Quarter and Year-End Financial Results
Collaboration and license revenue earned under Portolas collaboration and license agreements with Bristol-Myers Squibb Company and Pfizer, Bayer Pharma and Janssen Pharmaceuticals, Daiichi Sankyo and Dermavant Sciences was $13.7 million for the fourth quarter of 2016 compared with $4.4 million for the fourth quarter of 2015. Collaboration and license revenue for the year ended December 31, 2016, was $35.5 million compared with $12.1 million for the year ended December 31, 2015.
Total operating expenses for the fourth quarter of 2016 were $68.9 million compared with $70.7 million for the same period in 2015. Total operating expenses for the fourth quarter of 2016 included $7.9 million in stock-based compensation expense compared with $6.8 million for the same period in 2015. Total operating expenses for the year ended December 31, 2016, were $305.1 million compared with $239.2 million for 2015. Total operating expenses for the full year ended December 31, 2016, included $30.4 million in stock-based compensation expense compared with $22.9 million for 2015.
Research and development expenses for the fourth quarter of 2016 were $56.0 million compared with $59.8 million for the same period in 2015. Research and development expenses were $246.9 million for the year ended December 31, 2016, compared with $200.4 million for 2015. The increase in R&D expenses was primarily due to increased program costs to advance andexanet alfa of $64.7 million, including a $27.3 million one-time charge to write off certain prepaid manufacturing costs and increased program costs to support cerdulatinib and early research programs of $3.8 million, partially offset by decreased program costs related to betrixaban of $22.0 million following the completion of the APEX clinical trial enrollment.
Selling, general and administrative expenses for the fourth quarter of 2016 were $12.9 million compared with $10.9 million for the same period in 2015. Selling, general and administrative expenses for the year ended December 31, 2016, were $58.2 million compared with $38.9 million for 2015. The increase in SG&A expenses was primarily due to increased headcount-related costs, commercial launch preparation activities and business development-related costs, and costs associated with professional and accounting fees of $2.0 million.
For the fourth quarter of 2016, Portola reported a net loss of $53.8 million, or $0.95 net loss per share, compared with a net loss of $66.1 million, or $1.23 net loss per share, for the same period in 2015. Shares used to compute net loss per share attributable to common stockholders were 56.5 million for the fourth quarter of 2016 compared with 53.6 million for the same period in 2015. Net loss for the year ended December 31, 2016, was $269.0 million, or $4.76 net loss per share, compared with a net loss of $226.5 million, or $4.36 net loss per share, for the same period in 2015. Shares used to compute net loss per share attributable to common stockholders were 56.5 million for 2016 compared with 52.0 million for 2015.
Cash, cash equivalents and investments at December 31, 2016, totaled $318.8 million compared with cash, cash equivalents and investments of $460.2 million as of December 31, 2015.
2017 Annual Financial Guidance
For the fiscal year 2017, Portola expects total GAAP operating expenses to be between $323 million and $344 million. For the fiscal year 2017, Portola expects total pro-forma operating expenses to be between $290 million and $310 million, excluding stock-based compensation. These expenses will be primarily for manufacturing of both andexanet and betrixaban, support of ongoing clinical trials and preparation for the potential commercial launches of betrixaban and AndexXa.
Non-GAAP Financial Projection
This press release and the reconciliation table included herein include a non-GAAP projection of 2017 operating expenses, excluding stock-based compensation. A reconciliation to projected GAAP 2017 operating expenses is provided in the accompanying table entitled "Reconciliation of GAAP to Non-GAAP Projected Operating Expenses." Portola management believes this non-GAAP information is useful for investors because it provides information about the Companys ability to independently fund and advance its operations with existing capital resources. Share-based compensation is not an expense that requires cash settlement, and therefore, the Company excludes these charges for purposes of evaluating our ability to fund future operations.
Conference Call Details
The live conference call today, Tuesday, February 28, 2017, at 4:30 p.m. Eastern Time, 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 71935945. The webcast can be accessed live on the Investor Relations section of the Companys website at http://investors.portola.com . It will be archived for 30 days following the call.
About Portola Pharmaceuticals, Inc.
Portola Pharmaceuticals is a biopharmaceutical company developing product candidates that could significantly advance the fields of thrombosis and other hematologic diseases. The Company is advancing three programs, including betrixaban, an oral, once-daily Factor Xa inhibitor; AndexXa(TM) (andexanet alfa), a recombinant protein designed to reverse the anticoagulant effect in patients treated with an oral or injectable Factor Xa inhibitor; and cerdulatinib, a Syk/JAK inhibitor in development to treat hematologic cancers. Portolas partnered program is focused on developing selective Syk inhibitors for inflammatory conditions. For more information, visit www.portola.com and follow the Company on Twitter @Portola_Pharma.
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, anticipated product approvals, the potential of our product candidates to advance the field of thrombosis and benefit patients and the timing of our regulatory events and statements regarding the timing and ability to achieve other milestones and events, including those described under the section "Recent Achievements, Upcoming Events and Milestones" and "2017 Annual Financial Guidance." Risks that contribute to the uncertain nature of the forward-looking statements include: failure to obtain FDA and/or EMA approval for one or more of our product candidates, 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 our ability to initiate and/or complete our clinical trials and the timing and expense of these trials; the results of our clinical trials related to the efficacy and safety of our product candidates; our potential inability to manufacture our product candidates on a commercial scale in a timely or cost-efficient manner; the accuracy of our estimates regarding expenses and capital requirements; our ability to successfully build a hospital-based sales force and commercial infrastructure; regulatory developments in the United States and foreign countries; 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 December 31, Twelve Months Ended December 31,
2016 2015 2016 2015
Collaboration and license revenue $ 13,693 $ 4,414 $ 35,504 $ 12,070
Research and development 56,032 59,814 246,854 200,376
Selling, general and administrative 12,861 10,881 58,235 38,869
Total operating expenses 68,893 70,695 305,089 239,245
Loss from operations (55,200 ) (66,281 ) (269,585 ) (227,175 )
Interest and other income (expense), net 436 (190 ) 1,472 305
Loss before taxes (54,764 ) (66,471 ) (268,113 ) (226,870 )
Income tax benefit -- 365 -- 365
Net loss (54,764 ) (66,106 ) (268,113 ) (226,505 )
Net income attributable to noncontrolling interest (SRX Cardio) 923 -- (930 ) --
Net loss attributable to Portola $ (53,841 ) $ (66,106 ) $ (269,043 ) $ (226,505 )
Net loss per share attributable to Portola common stockholders:
Basic and diluted $ (0.95 ) $ (1.23 ) $ (4.76 ) $ (4.36 )
Shares used to compute net loss per share attributable to Portola common stockholders:
Basic and diluted 56,543,875 53,623,313 56,480,647 51,981,463
Consolidated Balance Sheet Data
December 31, 2016 December 31, 2015
Cash, cash equivalents and investments $ 318,771 $ 460,161
Receivables from collaborators -- 1,000
Prepaid research and development 7,299 16,976
Total current assets 328,928 465,577
Property and equipment, net 6,143 6,243
Intangible asset 3,151 3,151
Prepaid and other long-term assets 5,214 11,993
Total assets 343,436 502,924
Accounts payable 14,546 10,279
Accrued research and development 23,818 24,195
Accrued compensation and other liabilities 6,502 8,285
Deferred revenue (current portion and long-term) 45,763 27,016
Total current liabilities 65,664 51,146
Long term obligation to Collaborator 8,000 -
Notes payable, long-term 50,061 -
Total liabilities 150,747 72,601
Total stockholders equity 190,532 427,396
Noncontrolling interest (SRX Cardio) 2,157 2,927
Total stockholders equity 192,689 430,323
Total liabilities and stockholders equity 343,436 502,924
Reconciliation of GAAP to Non-GAAP Projected Operating Expenses
2017 Projected Operating Expenses-GAAP $ 323 $ 344
Stock-based compensation expenses 33 34
2017 Projected Operating Expenses-Non-GAAP 290 310
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