Alexion goes in a new direction with $1.4bn Portola buy

Alexion’s move on the anticoagulant reversal specialist is not the most intuitive deal – but is 2020’s second biggest so far.

Deals

In unpredictable times, the appeal of a safe and steady sales stream cannot be denied. Despite Alexion’s talk of portfolio diversification and strategic fit, the reliable, if less than gobsmacking, revenue from the recombinant clotting factor Andexxa is likely one of the major reasons behind its $1.4bn acquisition of Portola Pharmaceuticals. 

Andexxa, the only approved Factor Xa inhibitor reversal agent, is forecast to attain blockbuster status in 2025 according to consensus compiled by EvaluatePharma. Alexion is relying on geographical and label expansion of this drug to make the Portola acquisition work, but the sales model underlying Andexxa is very different from that followed by Alexion’s current products, and it could be difficult to adapt.

Andexxa is used to reverse the effects of blood thinners should a patient suffer a life-threatening bleed. As such it is kept in stock in hospitals and is used in the emergency room, probably only once in a patient’s lifetime. Alexion’s other therapies are generally intended for the chronic treatment of rare diseases.

Thicker than water

Speaking on a conference call today, Alexion’s management dismissed this, saying that the therapy fits with its other critical care products such as Soliris and Ultomiris, used to treat haemolytic uremic syndrome. Alexion has an established acute care hospital platform since HUS patients tend to present to the emergency room, allowing its reps to offer Andexxa to the ER doctors and trauma surgeons with which it already does business.

And it has big plans for expanding Andexxa’s reach. Alexion reckons it can expand the product in Europe, with “wave one” markets including Germany and the UK. After that it will push into other countries including France, Spain and Italy where the group says there are high rates of factor Xa inhibitor use. In April BMS and Pfizer returned Japanese rights to Andexxa, allowing Alexion a clear shot at the 2.5 million Factor Xa inhibitor patients in that country.

The company also wants to obtain expanded approval. Andexxa can currently be used to reverse the effects of Xarelto or Eliquis, but “has the potential” to also be used with Daiichi Sankyo’s Savaysa and Sanofi’s Lovenox, according to Alexion’s chief financial officer Aradhana Sarin.

The casual observer might wonder why Portola was not pursuing those opportunities itself. The company's full-year results in January which revealed disappointing sales of Andexxa point to the answer. The drug generated $111m in 2019 against estimates in the $130m range. This caused the unprofitable company to haemorrhage nearly half its value.  

Portola’s stock, which was trading as high as $25m at the start of the year, closed yesterday at $7.76, which must have made Alexion’s all-cash offer, at $18 per share, look pretty appealing.

As to whether the acceleration of Andexxa sales can happen in the way Alexion hopes, analysts from Stifel reserved judgement, saying it “will truly be a ‘show-me story’”. The other open question is whether the company will be able to attract hospital administrators’ attention to point out the availability of Andexxa in new markets, or for new indications, during the current pandemic. 

Portola's marketed products and R&D pipeline
Product Status Mechanism  2020e 2022e 2024e 2026e
Andexxa Marketed Factor Xa regulator 233 522 827 1,143
Bevyxxa Marketed Factor Xa inhibitor 3 18 40 45
Cerdulatinib Phase III Jak inhibitor; Syk inhibitor - 8 28 43
Cerdulatinib topical Phase II Jak inhibitor; Syk inhibitor - - - -
PRT2761 Phase II Syk inhibitor - - - -
SX-PCK9 Preclinical PCSK9 inhibitor - - - -
Note: Jak = Janus kinase; Syk = spleen tyrosine kinase. Source: EvaluatePharma.

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