Rally on! Here’s Why Portola Pharmaceuticals (PTLA) Shares Jumped 20% Today


Investors love biotech stocks for the lottery ticket-like returns they can offer if a company strikes medical gold or wins the regulator’s blessing. Case in point: Portola Pharmaceuticals (NASDAQ:PTLA), whose shares are jumping nearly 20% on Friday. Why the excitement? The volatile drug maker announced that the FDA has approved its lead candidate Andexxa, developed to reverse anticoagulation for Factor Xa inhibitors.

Read more: Watch Out for These Pharmaceutical Players Racing Toward FDA Approvals

“Today’s approval represents a significant step forward in patient care and one that the medical community has been eagerly anticipating,” said Stuart J. Connolly, M.D., ANNEXA-4 Executive Committee chairman and professor in the Department of Medicine of the Faculty of Health Sciences at McMaster University in Hamilton, Ontario. “Andexxa’s rapid reversal of the anticoagulating effects of rivaroxaban and apixaban will help  clinicians treat life-threatening bleeds, where every minute counts.”

The use of Factor Xa inhibitors is rapidly growing because of their efficacy and safety profile compared to enoxaparin and warfarin in preventing and treating thromboembolic conditions such as stroke, pulmonary embolism and venous thromboembolism (VTE). This growth has come with a related increase in the incidence of hospital admissions and deaths related to bleeding, the major complication of anticoagulation. In the U.S. alone in 2016, there were approximately 117,000 hospital admissions attributable to Factor Xa inhibitor-related bleeding and nearly 2,000 bleeding-related deaths per month.

“We are grateful to the patients who participated in our trials, our clinical trial collaborators, our employees and the FDA for their help in bringing this new drug to market for the benefit of patients with Factor Xa inhibitor-related bleeding,” said Bill Lis, chief executive officer of Portola. “We are proud that Andexxa is a first-in-class medicine discovered in our labs. In addition to Bevyxxa, the first and only anticoagulant approved for extended VTE prevention in acute hospitalized medical patients, Andexxa is our second FDA-approved product with the potential to save lives and have a major impact on global public health. We remain committed to our scientific leadership in the fields of thrombosis and hematologic cancers.”

Most analysts on Wall Streets are out rooting for this drug maker to be a winning stock pick, as TipRanks analytics showcase PTLA as a Strong Buy. Based on 6 analysts polled in the last 3 months, 5 rate a Buy on Portola stock while only one maintains a Hold. The 12-month average price target stands at $53.80, marking a nearly 33% upside from where the stock is currently trading.

 

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