Q4 2019 Earnings Call

in the meantime

And many German hospitals are making progress in applying for the new which is similar to the and tap in the US and allows them to receive supplemental payments for on dexia. In fact over six hundred hospitals in Germany have already applied for the new which is the second highest level for any Hospital Drive in the first year after approval.

This further demonstrates the unmet need that you can sell and it is clear that there is a significant potential for long-term Global growth.

During the year, we plan to initiate access and reimbursement activities in our way of two countries, which include the other large bu5 markets of France Spain and Italy we are excited to closer to making on Deck see available to patients in these markets and the rest of Europe which altogether represents a growing opportunity with approximately twice the number of patients as compared to the United States. I'm proud of the important progress our teammate in 2019 as we advance the launches event in the US and I'm in Europe looking at the 2020. We are confident in our strategy for making a dexa the standard of care globally.

Before I turn the call.

Over to regime I would like to mention a powerful patient story that was recently shared in the media. We're reasonably healthy man taking a pics of an died when being treated for an aortic dissection at the hospital that did not stock and dexa.

Maisie started this never happens again is what drives everyone of us at Portola in our efforts to make this treatment standard of care that will now turn over to Reggie's thank God. I'm excited to now be part of the team. The fundamental reason I joined is the promise of end except for patients with serious or life-threatening bleeds. I believe this process will be achieved because index is a Precision medicine and Portola is committed to advancing the index evidence space and dexa was deliberately engineered to only have one pack actual to act as a decoy to bind and sequester Factor ten a Inhibitors the design index. It is elegantly simple modify the factor 1080p with a single amino acid substitution and modify the factor ten light chain via truncation these modifications with the FDA-approved dosing regimens dead.

Resulting in Rapid and substantial reductions and anti Factory activity therefore and dexa in my view is an example.

Let me Precision medicines.

We had a clinical strategy to advance the index evidence base. We plan to publish a additional data from the anexa for study as Scott mentioned the primary public appeared in the New England Journal of Medicine last year, but the index of Ford database is a rich source of additional clinically useful data that will further differentiate indexer. We will also capitalize on real-world databases to characterize. It's clinical and economic profile beyond the Nexus 4 black randomized control trial and next guy is ongoing and will generate data in patients on a fix the ban and rivaroxaban with the highest unmet needs. We have also initiated a single-arm study and Urgent surgery an XS which will inform a randomized controlled trial in this population.

We also aim to expand a label for use in.

bleeding patients treated with other Factor ten a inhibitors

Additional studies may be undertaken to further reinforce the unique pharmacodynamic effect of indexer the rapid and substantial reductions and enter Factor activity. Finally. We remain steadfast in our education efforts. We will continue to educate the Healthcare Community about why a factor ten a inhibitor treated page to only be given index of when they bleeding event occurs.

Frozen this month, we began supporting the American Heart Association efforts around enhancing awareness and understanding of Best Care practices for hemorrhagic stroke patients at the international stroke conference in Los Angeles, the multi-year initiative built on a successful get with the guidelines hospital-based quality improvement program, and we'll provide the medical community with further clinical insights as to the challenges and opportunities and treating patients with Factor ten. A related project stroke looking ahead. We have a defined plan to present new data at Medical and pay our Congress has throughout the year to support the continued growth of index off this effort will start with the American College of Cardiology 69th annual scientific session together with the World Congress of Cardiology in March.

the near-term date

Will include the potential effect of index versus for Factor PC on 30-day mortality. This retrospective analysis is based on comparing Propel Factor ten 8 reaches populations from the index of for study and the orange registry. I look forward to providing more details at the q1 call with that. I will need to call over to Scott or closing remarks. Thank you receive. I'd like to leave you with four key takeaways from this call First we're confident that index will become the standard of care for patients taking a pix of band can rivaroxaban that experience life threatening fleets second. We have several near-term Catalyst for index in the United States including new programs to drive broader adoption off or the initial attraction from our European launch Monday demonstrates the unmet need and acceptance among Physicians and pharmacists in Europe. And finally we're streamlining are spent and hath

Cash resources for significant growth milestones for index at in the United States and Europe. I want to thank you for your continued interest in Portola with that. I'll turn it over to questions operator. Thank you to ask a question. You need to press star one on your touch-tone telephone to withdraw your question, please press the pound key. Please stand by while we compiled a q and a roster.

Our first question comes from Vikram part of Morgan Stanley your line is open.

Hi, thanks for taking my question to from my side both kind of focused on the utilization reviews that you alluded to when you pronounce 419 sales. So first off I wanted to see if you have any visibility into how utilization has trended in the tier one centers that were reported to have instated durs and fourteen nineteen and then secondly to the extent you have visible on the topic. Do you know of any additional centers your Day 2020 that have been stated similar durs?

Thanks for the question Vikram. So the focus of the call today is on Q4 and year-end. We look forward to giving you an update on both revenue and trends for q1. And that's pretty much in mind with our practice which is to stick with the quarter when we're talking about the quarter call, but as it relates to drug utilization, do you are squared 2019? I'll turn that over to show that you provide some additional, Thank you Scott. Hi Bikram. Thanks for the question. So is there a leads to fourth-quarter not too much more additional that you know, we have not already stated what we're changing Morgan but just a few things like you want to add and that is reinforced as we talk about the drug legalization reviews. When we did our pre-announced first again institutions are always going to conduct drug foundation reviews. This is common among all Hospital products. Not just and dexa of these can happen on a daily basis a weekly basis a monthly basis I think for us off.

the opportunity that exists

As we can as these dors continue we can actually help institutions better inform their decisions. As you heard, right? You mentioned we have new data that will be coming out of these. You see that's just going to point the value proposition of index and we'll be able to utilize that data as we move forward through 2020 as institutions evaluate and wage reform drug deal ization reviews. Maybe just add one other point program. One of the things that we do know is that not all drug legalization reviews results in a negative outcome. We know many instances where a hospital conducted a drug utilization review and it didn't change or might even increased usage. So I wanted to make sure that that was clear to you as well.

Okay fair enough. Thanks. Thank you. Our next question comes from that picture of William Blair.

All right. Great. Thanks for taking my questions too. If one on the surgery study, I noticed it says potentially give and dexa for 6 and 1/2 hours in that trial I guess and just click on that. And then are you going to be able to look at a correlation between Factor ten activity inhibitor activity and the surgeon walk-ins on hemostatic control? Just thinking that might give a more controlled environment to look at the correlation between the two than what we've seen in some of the emergency bleeding patients.

so

Thanks for the question. So on the first question about the single on surgery study just remind you that a key objective that study is to inform the randomized control trial and part of that in a swimming is dosing of and X in the operating room. And you are correct that if the surgery goes beyond two hours, we do allow the certain to consider incremental dosing based on clinical need and the second point you raised about can we take anti Factor ten a levels and correlate that with a clinical outcomes in this case the surgical assessment that hemostasis the answer is that something we would do in our analysis plan as you may recall on the index of for publication, we present the data from that trial to capitalize the correlation. There's several reasons why the correlation is not straightforward and that's why we use every opportunity we can in this case randomized control trials and building that correlation wage.

Your base and maybe just to clarify if you remember from a Nexa for the the correlation did hold in the intracranial hemorrhage population.

So we think that was because of the Fidelity that you have and measuring hemostatic volume expansion due to serial CT scans a little bit harder in a GI bleed. So it's worth pointing out that we actually did see a correlation in an explore in the i c h population.

Thanks, and then if I can follow up on your I guess one question is as we get closer to the nice judgment, I mean is there should be almost just assume they're negative. There's might be negatively biased just wage because that's how nice often is around first assessments particularly for maybe accelerated approval type drugs. And then also just wondering if you comment on the agreement within said some of the ways to countries and how that might impact the eventual expansion into those countries.

Yes, I'm at at Sheldon first. Let me speak to nice when I would say to that is you or not thinking of it as it could be a negative Centre were actively negotiating with nice. We feel that we put together a very comprehensive dossier and you know, we'll know more about that as we continue those negotiations and we'll have a readout on that in the first half of 2020 or June of 2020 and I relate to the sexual for the way to countries. So this would be Spain France and Italy. Yeah, so this is just more of a way for us to be proactive to make sure that we have distribution for those countries should they would want to use the product and again, you know, what we want to do is we want to maximize. Yep.

lean fashion our footprint in your

Correct. And this is the best way to do that by signing on a sexual to help us do this and maybe minute back to the nice. And this I think is also relevant to the am not discussion off when you submit a data package. That's primarily based on a single-arm trial. It's likely in these discussions that you may see it in in the box to the TV and others quantification of no additional benefit. That's standard when you have a product that like a deck so that did a a single line clinical trial. I think one of the things that really impressive that showed up mentioned on the call was relative interest for the hospitals in Germany. We had over six hundred hospitals of five for the new that was as we send the second highest that we've seen for product launched in Germany. So we believed physician support is there but the negotiations are influenced by the data package and having a not having a randomized trial can influence the conversations.

Thanks. Thank you. Our next question comes from a Credit Suisse line is open. Hey guys, thanks for thanks for taking the question.

So you wanted to explore and tapping and potential driver off of Greater civilization. So just curious if you have any data on installation in hospitals where and tap is actually being correct either apply for and just as many different than hospitals. They may not be fully taken advantage of events at 4 for whatever reason and would benefit from some of the initiatives. You guys are undertaking angst. I'm not sure so high chair. Thanks for your question. And you know, let me speak to the questions related to end tap. We don't have a lot of wholesome data yet as relates to age or something provided by the CMS to the point that you made and tap is underutilized and it is our our mission to pay the ways to 1 a.m. We have and have recognized as a way for these institutions to get a reimbursement as high of 65% to the cost of a dexa. I cannot emphasize that enough wage.

With that said what we do know speak to the underutilization of and tap, we know that for those institutions that could apply for an attack about 25 only 25% of them applying for the impact what we see is that those who do apply for the and tap more than 90% of them actually receive an end tap reimbursement. So we know that it works. So it just sort of things that were doing. We just hired an institution institution reimbursement manager. We're going to have a few other of these people. They're actually going to work out those work with those institutions, but we know the opportunity just where they could actually be applying for the end tap actually next week. We're rolling out what's called the Portola access Navigator and this is going to be a tool that would be completely directed at hospital administrators billers and coders of Institutions. So we will be doing that. Um, very, correct.

Play again, I think our mission.

Is really paved the way so that there's recognition of the and tap and that it is utilized on a routine basis.

Got it. Thanks.

Thank you. My next question is from you. It's a Citigroup. Your mind is open. Yeah. Hi. Thanks for taking the question was just a few more on the end cap. I guess given a new initiatives that your own unveiling including. I think I've heard a call center. Could you just give us some realistic assessment or appraisal of of what percent of eligible ends have cases you believe are are going to be um, uh passing through the untapped process sort of in the next 12 months how how what can walk you realistically go from the 25% Thanks. Yes. Thank you Gulf. So we we do not have a specific number that we're targeting what we're really doing applying this effort to get to as many institutions as possible. Keep in mind that all institutions are eligible to actually apply for the intact. So when you think about our target audience of birth

100 institutions that are out there

All 2,100 of those institutions and even those are non targets they have the ability to um able to apply for the end Tab and we're making sure also I just wanted to reinforce there's some other things that were involved with where we're going to be speaking to some very high-level administrators c-suite Etc of these institutes need to integrate to get some of the plans that I mentioned a little bit earlier on on the previous question again, the access Navigator making sure that we make sure that our reimbursement managers are working in these institutions so they can see the opportunity. Maybe if I could just take a minute to drill down on that a bit more these reimburse managers are experts in the EMR system that exists in these hospitals as typically epic for Cerner and they're able to actually identify. Yep.

The way to automatically apply specific.

Drg codes to the end cap application. So it removes the manual aspect which is tedious and tiresome and sometimes forgotten. So this is a way to help automate wage on that system. One thing that I found to mention on. The last question that we've also opened is related to the end cap is a call center. So our call center is actually live right now. We guarantee that there is some question is asked there's an answer within 24 hours and how that works. Is that all 116 of our representatives and our sixteen am a liaison they they they all have a number to allow them to contact our call center with questions.

Okay got it. And as far as tracking the usage of my understanding is that there's a bit of a lag as much as six months given that you're getting the data from CMS long. Is that going to change at any point such that the the street would have a more real-time assessment of the usage of ends up or we always going to be facing the six months lack CMS? Yeah. So, you know, I wish we could have some control over that but it is, you know going to be 6 to probably 9 my time lag but I think you know, what should we maybe able to do as a quarters go on we can actually perhaps to qualitative feedback of where we've been successful these initiatives of that. They allow you to better gauge with our practices. Okay. Thank you.

Thank you.

Our next question comes from John McNeil Goldman Sachs in line is open.

Hi there guys. Thanks so much for taking the question. I maybe wanted to start by, you know, given that we're more than halfway through one Q 20 if you you know provide any wage, maybe what you've seen index a trending like the so far and then I have a follow-up after that. Thanks.

Sure, John it I said I think the question that they asked the beginning as is our standard practice. We don't comment on a quarter until the quarters done. This call is about 2 for a year-and-a-half. We do look forward to providing you an update in on our q1 progress. And that would be in our main call. And you said you had a follow-up question. Yeah, then maybe just as you look at home the rest of the year, you know, do you think there any other places either this year? Maybe next year where you could see, you know potential for more cost savings or more kind of right-sizing your operating structure. Yeah. Hi John, this is mom, Um, thanks. Thanks for the question. So as we said on the call, we are aligning the business to a dexa and we've done a good job streamlining our our expenses, but we all are making the right Investments. Right? So we're making the investments in the data that you spoke about and clinical data real-world data and label expansion work for index as well as our Geographic expansion. So more work. Yep.

and we had the full year of fact of our sales force is

Europe as well as a full year of fact in 2020 of our operations in Europe. So we need this to drive Revenue going forward. So what you're not seeing a 2020 then our expenses regarding for example, the Celtic one study for sort of Latin web and all the costs related to that and some of our early development work. So we feel pretty good about the effects structure for Portola right now and we think it's pretty close to the structure that you're going to see actually be on 2026 last point. I'll make on that is you know, we've done a benchmarking effort with 25 like commercial companies, um, um in our in our peer group looking at all the expense, um for companies that have some R&D and um commercial efforts. Most of those don't have a European effort as well. And I would say we are smack in the middle of that to a little low wage.

A total of expense and we feel like we've done a good job streamlining and taking important steps to focus what we think are the gross drivers of the business and that's where it's going to say 4000 in in the next couple of years. Great. Thank you so much party.

Thank you.

And how many line is open?

Oh, hey, thanks for taking the questions. I was wondering if you could confirm that the reimbursement can be applied for retroactively and Thursday. Are there any time limitations as far as how far back you can go to apply for reimbursement? Yes. Hey, so yes, so you can go and you can track actively applying for the end cap. I want to double-check this but I believe it's up to six months prior that you can actually go back and apply for the intact and we are actually remaining customers of this one last thing to that cuz I knew you were always interested in educational opportunities and things that we've done in the past in about 2 or 3 weeks ago. We actually suspended Congress of billers and coders. These are people that were specifically in the hospital. They're responsible for all the coding so that bills can be created within these Instagram.

And and we went there we presented at some of the work that will be doing.

We talked about the fact that again the availability of the end cap that is allows for up to a 65% reimbursement event. Also to your question. You can retroactively go back and apply for this and we also talked about as I mentioned some of the resources available.

Okay, great. Thanks for that additional color. I know it's early on but can you comment on any initial feedback you've gotten from institutions on the educational program?

Well, yeah, so actually I attended the international stroke conference last week in Los Angeles. I was a desert program and I happened to be this was a difference of about 70 people and there are some folks at the table. And by the way, the attendees of this are stroke coordinators neurologist Emergency Room Physicians et cetera. So these are like directly, um, you know, working a large institution some spawn situations dealing with patient care and we were talking about the impact. This is right after the speaker was done and it happened in a custom individuals from Connecticut from an institution. They're talking about the impact and they were talking about I was telling them about the fact that we have these institutional reimbursement factors and the women kind of I'm not kidding almost jumped our scene said, oh, yeah, we met her. She was just starting institution. Matter of fact her Hospital would be would love to hire her wage.

she's working for you and

She talked about how she's already helped institution a great deal. But we before she was actually up in Boston and working with some folks. There were actually also partnering with jobseekers. You actually saw at our analyst day back in November. Who by the way as you may recall, is it the user at the end tap and there's actually showed how the end cap can allow you as we set it off today to break even on the cost related to index. So that's just one story and she has only just started. Okay. So very very encouraged. It was great feedback. Thanks for that color. If I could ask about sort of Latin and the decision not to initiate the Celtic one trial. Can you come in on the types of Partnerships? You're considering and I guess sort of the process you're going through there.

Yeah, hi Jay, it's Marty again. I think we've talked about this before, you know, we'll look at.

All types of Partnerships for certain that nobody really believed the asset and not only ptcl where we've shown some excellent data in a sub-type called a i t l but also offer a showing in particular in combination with rituximab and um potential for other combinations. Um, so this drug needs to be in a home where they uh focus more on oncology and can we put out a full development plan to develop a proper way. So, you know, we're looking for all all types of Partnerships for this asset in like we said, we like what we're seeing what's the lounge or in combination with rituximab? We showed that data last December and we're keeping a study ongoing that that could be interesting showing that same combination that would help and inform partnering efforts. So that's what we're doing with your latinum.

Okay, great. Thanks for taking the questions. And your next question, Kenneth is open. Hi, thanks for taking my question. Do you have any visibility into how exactly hospitals that undertook durs in Q4 change station to index of which patients who would have gotten index are no longer getting it.

So you have happy to address that. Um, so again, you know two Scotts Point as related to drug utilization review. There was some you know, some institutions that perform these drug legalization reviews off their use of index as it relates to others that have done their drug utilization reviews as we mentioned the fourth quarter. We never saw anyone actually leave utilization of Anthrax. So if anything they're used might have declined a bit as we also mentioned during the pre-announcement to JPMorgan we saw them rise up to a level of stabilization. We don't really have insight into each specific institution of where they're using index and what I can tell you is that we conduct a chart on it on a quarterly basis. We just received a package results report pull your perspective and when you look at it and x and the utilization of index it's used across all different types. So it's used in i c h it's used in d i it's using birth.

Related to Pardon to mental bleeds. So for me to say it's only being used specifically in one area or another a specific institution. We feel that the chart on is a very nice example gives us the idea of

Where the drug is being used the last thing I would say that is, you know, we spend a lot of time out in the field and listening to our field we go to all these institutions and we here we're index is a used in multiple different cases and you may recall on the script. I actually talked about the fact we're in Dexter was not used in the case of an aortic dissection and just give example of you know, where the drug potentially could have been used. We heard of a similar case where index was used in a or the dissension or Dissection. The patient was transporting, um, too large Medical Center here in California and that patient actually survived so that would be an example of you know, bleed type that different than i c h different than GI, but it shows you the variability of these different blood types.

Okay. Thanks.

Could take a follow-up question Sheldon. You just talked a lot about inside of education. But the article that you you talked about where the patient died going to the hospital didn't have index. Apparently the hospital also did not know about the consignment program. Is that something that it getting use it all and you think is that part of the education process and similarly, I guess, you know see code usage. Is that been anything incremental? And then are you all still under the impression that index will either receive a drg code in Q4 or maybe you know calculating the drg codes for for the bleeds.

So let me first start with Consignment Consignment is something that I would say that everybody is aware of and off and I was and I know that this institution was aware of Consignment. So I'll stop there with that. Um as it relates to see codes what I don't have yet as we don't have any data related to the seat code of this is similar to you know, the end tablet CMS. There's just a delay, but I can tell you on a qualitative basis from again being out in the field listening to our Representatives Etc. We hear a lot of stories about community-based institutions that start patients come on and I can ship them to a level 1 Trauma Center Etc. By the way, just want to mention um in your just going back to your first question, you know an institution such as the example that we gave birth.

Thank you. Our next question comes from Mike Pitts of William Blair is open.

during the script

These interviews to see code as well. They could have used to see code starting with the patient and transported them. But again to your point, you know, they could have they could have qualified they did qualify wage. You're confined a product. I think it was just a choice, um that they that they did not when you guys one other sub questionnaire drg update says related to the page update. We're currently working with CMS. I have no really further update to give at this point. The only thing I would say is that there's approximately 57 BR BS or currently out. There can be linked to the use of and dexa again. All these drgs were developed before and Dexter was never developed but we are currently working with CMS. And as we continue to have updates on that will provide you actually have the opportunity to meet with the secretary of Seema Seema Verma at JPMorgan. We are 1 a.m.

And two other companies that were able to get 45 minutes and chat with her and we talked about all these things actually that are being discussed today.

Thanks. So then I guess if I could ask you one as well, you kind of talked about the potential ability to get supplemental filings for a doctor Banner an octave parent. I know you guys just published on faith to data on the reversal of edoxaban obviously healthy volunteers, but I guess what additional work needs to be done there and you kind of also hinted that additional studies may be undertaken to reinforce the effect of and Ducks if I heard that correctly. Can you elaborate on that at all? So on the first question an extra for as I said in my prepared remarks is a rich source of data a month and that resource of data includes patients who are treated with the docs have been in Oxford Commons. So our thinking is to share those data with the FDA off and to find up transfer work for that potential label expansion on your second question about additional studies to further characterize the pharmacodynamics profile of

I would leave that to the next call. Um.

We're thinking about again holistically how we advance this evidence base and what the most meaningful steak is our to do that. So I'll be prepared with the rest of the to talk about that at the next call. Maybe I should clarify. I'm at the two of those were not linked to one another we believe we have sufficient data from an extra port to approach the FDA to have a conversation. So it wasn't about doing additional studies with the docs birth parent, but will certainly provide updates going forward. Yes. Hi ma'am. This is Pam just to comment on the paper. That was just published that edoxaban data package will be used as regime stand in combination with an extra for data to become part of our potential label expansion filing for edoxaban.

Great. Thanks for taking my Phillips.

Thank you. I'm showing no further questions at this time like trying to call back over to Scott garlick for any closing remark. I just want to reiterate some of the key themes were called today. We remain confident in both near and the long-term growth potential for index that's based on the fact that it is a novel breakthrough drug at the only FDA or email proved agent for the reversal effective today. And am. Beginning able to Market is a very large and growing Market as we talked about on prior calls. The number of patients that are taking 10 Inhibitors is growing at least in 2019 at a nearly 20% rate. We have opportunities to agent a label for index that we talked about on the call today opportunity to expand geographically and then of course when the factor ten able to start going generic and 20 23 and 24, we expect the use of those drugs to expand beyond what we're currently seeing today. The second key point is that we have Catalyst both in the near and a longer-term to drive growth and then the final pieces that we are making the

right investment

To drive growth for index. So so want to end on those comments. I want to thank you for your time and attention. We'll look forward to updating in the future if ladies and gentleman this concludes today's, thank you for participating you may now disconnect. Have a wonderful day. Goodbye.