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Portola Raises $60M in Series C Extension
[July 09, 2008]

Portola Raises $60M in Series C Extension

(BioWorld Today Via Acquire Media NewsEdge) Portola Pharmaceuticals Inc. raised $60 million in a Series C extension round to drive its two lead cardiovascular product candidates through Phase II clinical trials.

The financing follows a $70 million Series C round raised in 2007, a $46 million Series B round raised in 2005, and a $21 million Series A raised in 2003. Altogether, that's nearly $200 million - a hefty chunk of change, but necessary to support cardiovascular trials, which require "a lot of money up front" but offer "very significant" commercial upside, said Portola Chief Financial Officer Mardi Dier.

Dier added that Portola's lead drugs, the anticoagulant betrixaban (formerly PRT054021) and the antiplatelet agent PRT060128, both address "multi-billion-dollar markets."

Betrixaban is an oral Factor Xa inhibitor designed to compete with warfarin, which is used acutely to prevent blood clots after surgery and chronically in atrial fibrillation patients at high-risk of stroke. Although warfarin is available generically, Bristol-Myers Squibb Co. still booked $201 million in revenues last year with its brand name version, Coumadin.

Portola anticipates that betrixaban will offer several advantages over warfarin, including once-daily oral dosing and low peak-to-trough variability, which means patients would potentially require less monitoring and dose adjustment to avoid bleeding episodes.

In a Phase II trial, betrixaban was well tolerated for the prevention of venous thromboembolic events (VTE) in patients undergoing total knee replacement surgery. The incidence of VTE was 20 percent, 15 percent and 10 percent in patients receiving low-dose betrixaban, high-dose betrixaban, and Lovenox (enoxaparin, Sanofi-Aventis Group), respectively.

Many people encouraged Portola to move into a similarly designed Phase IIb/III trial, which would be the fastest way to get the drug to market, said Portola President and CEO Charles Homcy. But Homcy told BioWorld Today he felt betrixaban's differentiating qualities would "really win in chronic markets." So the company decided to postpone its Phase III plans for the moment and focus on a 500-patient Phase II trial comparing the safety and tolerability of betrixaban to warfarin in the prevention of stroke in patients with atrial fibrillation. That trial is scheduled to begin later this year.

Portola is also developing PRT060128, an antiplatelet agent designed to compete with the blockbuster Plavix (clopidogrel bisulfate, Bristol-Myers Squibb Co. and Sanofi Aventis Group). But once again, Portola believes its drug offers advantages including quicker onset of action and reversibility, which allows it to be given before surgery. Additionally, PRT060128 is available both intravenously for acute use and orally for chronic use.

As with betrixaban, Portola plans to prove the merits of PRT060128 by going head-to-head against the competition. An 800-patient Phase II trial comparing the safety, tolerability and efficacy of Plavix to PRT060128 given intravenously and then orally in patients undergoing elective percutaneous coronary interventions is scheduled to begin later this year.

As of now, Portola owns the rights to both programs, although Homcy said partnership discussions around betrixaban have begun and the drug is receiving "a good deal of interest." Partnering activity for PRT060128 is expected to become more of a priority after the Phase II trial.

South San Francisco-based Portola also plans to use some of the money from its latest financing to advance its preclinical pipeline. The company hopes to file an investigational new drug application in 2009 for one of the small molecules in its Syk and JAK inhibitor program, which has shown preclinical proof-of-concept in inflammation. Following in late 2009 or early 2010 will be an IND filing for a Factor Xa antidote, which could be used to stop bleeding caused by a Factor Xa inhibitor. The company is also working on a substitute aspirin product for patients with aspirin intolerance.

The financing was led by new investor D.E. Shaw & Co. Additional new investors included Adage Capital Management, BBT Capital Management/Apothecary Capital, Janus Capital Group Inc. and Pac-Link BioVentures.

Portola's existing investors also participated in the round, including Abingworth, Advanced Technology Ventures, AllianceBernstein LP, Alta Partners, Brookside Capital, China Investment & Development Co., Frazier Healthcare, Goldman Sachs, IBT Management Corp., MPM Capital, Prospect Ventures, Sutter Hill Ventures, and Teachers' Private Capital, the private investment arm of Ontario Teachers' Pension Plan.

In other financing news:

? American Oriental Bioengineering Inc., of New York, announced the pricing of a private offering of $115 million for its convertible senior notes due 2015. The notes will pay interest semiannually at a rate of 5 percent per annum and will be convertible at an initial conversion rate of 107.6195 shares per $1,000 principal, which is equal to an initial conversion price of approximately $9.29 per share. This represents a 15 percent conversion premium based on the last reported sale price of $8.08 per share on July 8.



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