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Portola Pharmaceuticals Inc (PTLA) Q4 2019 Earnings Call Transcript

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Portola Pharmaceuticals Inc (NASDAQ: PTLA)
Q4 2019 Earnings Call
Feb 26, 2020, 4:30 p.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Operator

Welcome to Portola Pharmaceuticals Conference Call. This call is being recorded. At the end of the company's prepared remarks, we will open the call for questions and provide specific instructions.

I would now like to turn the call over to Jennifer Zibuda, Investor Relations for Portola. Please go ahead.

Jennifer Zibuda -- Senior Manager, Investor Relations

Thank you, and good afternoon, everyone. Today, we released our financial results for the fourth quarter and full-year 2019. The press release and accompanying slides, which you can advance through the webcast, are available on the Investor Relations section of the Portola website.

In the room with me are Scott Garland, President and CEO; Mardi Dier, Chief Financial and Chief Business Officer; Sheldon Koenig, Chief Commercial Officer; and Rajiv Patni, our Chief Medical Officer. Also with us today is Emily Faucette, our new Senior Vice President of Global Corporate Affairs and Investor Relations and for the Q&A portion of the call, we have Pam Conley, Senior Vice President of Research.

Before we begin, I would like to remind you that remarks on this call will contain forward-looking statements. For a more detailed description of important risk factors that could cause our actual results to differ materially, please refer to our Annual Report on Form 10-K.

With that, I will call -- turn the call over to Scott Garland.

Scott Garland -- President and Chief Executive Officer

Thank you, Jen. Hello everyone and thank you for joining us on our fourth quarter and year-end 2019 financial results call. 2019 was a year of significant accomplishments for Portola. We completed our first full year of Andexxa launch in the United States following the approval of our Gen 2 formulation.

The ANNEXA-4 data was published in the New England Journal of Medicine and we made important progress on reimbursement of a C-code in the outpatient setting, increased NTAP reimbursement in the inpatient setting and the addition of AndexXa to the VA National Formulary.

In Europe, Ondexxya received EMA approval in April and we built an experienced team to launch in our Wave 1 countries. Expanding access to the first and only FDA and EMA approved reversal agent for patients taking apixaban, rivaroxaban that are experiencing life-threatening bleeds.

Our European team also submitted dossiers to NICE and AMNOG allowing for initial sales in the second half of the year and setting the stage to establish reimbursement in the UK and Germany respectively this year. This all contributed to full-year global net revenues for Andexxa of $111.5 million.

We exited the year with 614 [Phonetic] hospitals that ordered Andexxa in the United States, and together treated over 4,000 patients during the year. We remain excited about our long-term growth opportunity and look forward to building on our progress in 2020.

While we are disappointed with the results in the fourth quarter, we gained important insights into the potential variability of our business and the impact that it can have at this stage of our launch. We are confident that Andexxa will continue to grow in 2020 and beyond, and it is our goal to provide annual revenue guidance once we have more visibility into these growth trends.

In Europe, we're focused on completing our upcoming negotiations with NICE and AMNOG during the second half of the year. We expect European revenues to be modest as we move through the reimbursement process and anticipate that we could see some quarter-to-quarter variability.

I would like to take this opportunity to reiterate the reasons we believe Andexxa is poised for significant growth. First, Andexxa is a novel product, addressing the unmet need in a large and growing market. Second, there are multiple opportunities to further increase the use of this important medicine through additional label indications and geographic expansions.

And finally, with the genericization of the Factor Xa inhibitor market starting in 2023, there will be even greater need for a specific FDA-approved reversal agent for this increased patient population. With this in mind, we are laser focused on driving near-term revenue growth. To support this strategy, we have taken three important steps to realign attention and resource allocation toward expanding the Andexxa customer base, driving utilization and increasing market share.

First, we have completed an internal restructuring that aligns with our strategic plans to support Andexxa and Ondexxya. We are streamlining our efforts and reducing spend on early stage and development programs in order to focus our resources on the Andexxa revenue drivers and lifecycle management.

Second, we've made a strategic decision to discontinue our efforts to commercialize our partner Bevyxxa. And finally, we've made the decision not to initiate the CELTIC-1 1trial for the SYK/JAK inhibitor cerdulatinib until we're able to secure a partner. Building on the compelling data we presented at ASH in December 2019, we will continue incremental work in follicular lymphoma in combination with Rituxan to support our partner in discussions.

The company will focus on the foundation of our business, which is to fuel the near-term and future growth of Andexxa and drive shareholder value by working toward our vision to be best-in-class in the treatment of serious blood-related disorders. To help us achieve this, we recently hired Dr. Rajiv Patni as our new Chief Medical Officer. And I would like to welcome him to the Portola team. Rajiv brings two decades of experience in clinical development and regulatory approvals, and will be focused on Andexxa lifecycle management plan with multiple data readouts and publications between 2020 and 2023.

This plan includes a randomized controlled trial, ANNEXA-I as well as studies to support label expansion, including the ANNEXA-S study in urgent surgery and the potential use of Andexxa with other Factor Xa inhibitors. We will have an opportunity to hear more from Rajiv directly in a moment.

So with that, I will turn the call over to Mardi for an update on the financials.

Mardi C. Dier -- Executive Vice President, Chief Financial Officer and Chief Business Officer

Thank you, Scott, and hello everyone. Total revenues for the year were $116.6 million, driven by a $111.5 million in global net revenues of Andexxa. Total revenues were $29.2 million for the fourth quarter, driven by $28.4 million in global net revenues of Andexxa, including $4.6 million in Europe.

Cost of sales in the fourth quarter was $29.6 million; included in this number is a one-time charge of $27.5 million related to inventory and manufacturing costs for Bevyxxa due to the strategic direction Scott just discussed. Exclusive of this one-time Bevyxxa write-off, full-year gross margins are 85%.Over the next couple of years, we anticipate higher gross margins as we supply customers with products that have been previously expensed, and we expect longer term global margins to be between 80% and 85%.

Total GAAP operating expenses for 2019 were $387.9 million. This compares to GAAP operating expenses of $385.5 million in 2018. Total non-GAAP operating expenses for 2019 were $295.5 million, which excludes $52.1 million in stock-based compensation and the Bevyxxa related charge.

Moving to other operating costs, I will refer you to our full-year results. In 2019, research and development expenses were $124.6 million compared to $216.2 million in 2018. A year-over-year decrease in R&D expense is mainly due to the Gen 2 manufacturing costs no longer flowing through R&D.

SG&A expenses were $218.9 million compared to $151.2 million in 2018. This increase is mainly due to the expansion of our sales force and other commercial-related activities for the launch of Andexxa in the US and Ondexxya in Europe.

Cash, cash equivalents and investments at December 31st, 2019 totaled $466.2 million compared to $317.0 million at December 31st, 2018. This provides resources to achieve key milestones and deliver future growth for Andexxa in the United States and Ondexxya in Europe over the next couple of years.

For fiscal year 2020, we expect R&D expenses to decrease to a range of $105 million to $120 million, including stock-based compensation expense of approximately $14 million. The 2020 R&D spend is focused on our clinical development plan to support the lifecycle management of Andexxa and plans to initiate validation of the second site for Andexxa manufacturing.

SG&A expenses for 2020 are expected to be in the range of $235 million to $250 million and include stock-based compensation of approximately $38 million. This planned increase over 2019 advances the launches of Andexxa in the US and Ondexxya in Europe. The 2020 spend includes a full year of our US sales force, which was expanded in April last year, a full year of expenses for Ondexxya team in Europe and market expansion and development activities in our Wave 2 countries in Europe. We remain confident in our ability to drive long-term success for the business, and more importantly, the patients around the world who stand to benefit from our efforts.

And with that, I'll turn the call over to Sheldon for an update on the launches of both Andexxa and Ondexxya.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Thank you, Mardi, and hello everyone. In 2019, we completed our first full year delivering the first and only reversal agent for patients taking apixaban or rivaroxaban in the United States. With each quarter, we are learning and adapting as we gain more insight into trends for this innovative product.

Today, I want to talk about the progress we have made, insights gained and plans for 2020 in the US and Europe, and I'll start with US. In 2019, we added 425 new hospital customers for a total of 640 accounts that have ordered Andexxa. We are approximately 40% penetrated into our Tier 1 accounts and 20% penetrated into our target accounts.

We have a significant opportunity in front of us for further penetration into all tiers of our 2,100 target hospitals and over 4,000 additional hospitals in the US. As we progress in 2020, we expect to add approximately 350 new hospital accounts throughout the year. We expect that our new customer mix in 2020 will include hospitals in all tiers as well as non-target hospitals that are proactively interested in adopting Andexxa, oftentimes through an affiliation with a larger hospital that is already using Andexxa.

Our business will not only be driven by new account adds, but also by broader adoption within existing accounts. In Q4, we saw the impact of fluctuations in utilization and [Phonetic] larger accounts can have and we have several new programs to help drive utilization in these accounts.

We will also be increasing educational initiatives regarding reimbursement pathways, targeting pharmacists and hospital administrators. For example, we have identified several hospitals who successfully utilize the NTAP reimbursement of up to 65% and we will share their protocols with other institutions as examples of best practices.

We have also identified significant NTAP savings that have not been utilized, which allows us to focus our efforts where they are needed most. To help our US customers streamline and secure reimbursement, we have set up dedicated teams to work directly with them to automate the NTAP submission process into their EMR systems. And we have also recently implemented a call center.

We have seen that when hospitals have applied the NTAP correctly, breakeven is a reasonable financial goal. Additionally, as part of our educational efforts specific to the Andexxa value story, we are working with leaders in the fields such as ASHP, the American Society of Health System Pharmacists. Together, we are identifying a series of initiatives customized to their 55,000 pharmacist members for national and regional outreach programs, clinical research and patient education.

Turning to Europe, we made great progress in our Wave 1 countries in 2019. The majority of European sales are direct to hospitals, reflecting the strong patient needs and acceptance of Ondexxya among European physicians and pharmacists. Underscoring the feedback from hospitals and physicians in Europe, the European Medicines Agency recently highlighted Ondexxya has been one of seven new key contributors to public health in 2019.

In the UK, we are on the agenda for a meeting with NICE to review our clinical and economic dossier late in the first quarter with the publication of the NICE report planned for mid-June.

Moving to Germany, we continue to expect the review of our AMNOG dossier to be completed in the second half of 2020, consistent with the one year process following our submission in September. In the meantime, many German hospitals are making progress in applying for the NUB, which is similar to the NTAP in the US and allows them to receive supplemental payments for Ondexxya.

In fact, over 600 hospitals in Germany have already applied for the NUB, which is the second highest level for any hospital drug in the first year after approval. This further demonstrates the unmet need Ondexxya can fill, and it is clear there is a significant potential for long-term global growth.

During the year, we plan to initiate access and reimbursement activities in our Wave 2 countries, which include the other large EU5 markets of France, Spain and Italy. We are excited to move closer to making Ondexxya 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 team made in 2019 as we advance the launches of Andexxa in the US and Ondexxya in Europe. Looking ahead to 2020, we are confident in our strategy for making Andexxa the standard of care globally.

Before I turn the call over to Rajiv, I would like to mention a powerful patient story that was recently shared in the media, where a reasonably healthy man taking apixaban died when being treated for an aortic dissection at a hospital that did not stock Andexxa. Making sure that this never happens again is what drives everyone of us at Portola in our efforts to make this treatment standard of care.

I will now turn over to Rajiv.

Rajiv Patni -- Executive Vice President, Chief Medical Officer

Thank you, Sheldon. I am excited to now be part of the Portola team. The fundamental reason I joined is the promise of Andexxa for patients with serious or life-threatening bleeds. I believe this promise will be achieved because Andexxa is a precision medicine and Portola is committed to advancing the Andexxa evidence base.

Andexxa was deliberately engineered to only have one mechanism of action, to act as a decoy to bind and sequester Factor Xa inhibitors. The design of Andexxa is elegantly simple, modify the Factor X heavy chain with a single amino acid substitution and modify the Factor X light chain via truncation. These modifications with the FDA-approved dosing regimens result in a rapid and substantial reduction in anti Factor Xa activity. Therefore, Andexxa in my view is an example of a precision medicine.

We have a clinical strategy to advance the Andexxa evidence base. We plan to publish additional data from the ANNEXA-4 study. As Scott mentioned, the primary publication appeared in the New England Journal of Medicine last year. But the ANNEXA-4 database is a rich source of additional clinical useful data that will further differentiate Andexxa.

We will also capitalize on real-world databases to characterize its clinical and economic profile. Beyond ANNEXA-4, the randomized controlled trial ANNEXA-I is ongoing and will generate data in patients on apixaban and rivaroxaban with the highest unmet need. We have also initiated a single-arm study in urgent surgery ANNEXA-S, which will inform a randomized controlled trial in this population. We also aim to expand the label for use in bleeding patients treated with other Factor Xa inhibitors.

Additional studies may be undertaken to further reinforce the unique pharmacodynamic effect of Andexxa, the rapid and substantial reductions in anti-Factor Xa activity. Finally, we remain steadfast in our education efforts. We will continue to educate the healthcare community about why a Factor Xa inhibitor treated patient should only be given Andexxa when a bleeding event occurs.

Earlier this month, we began supporting the American Heart Association's 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 builds on AHA's successful Get With The Guidelines hospital-based quality improvement program and will provide the medical community with further clinical insights as to the challenges and opportunities in treating patients with Factor Xa-related hemorrhagic stroke.

Looking ahead, we have a defined plan to present new data at medical and payer congresses throughout the year to support the continued growth of Andexxa. This effort will start with the American College of Cardiology's 69th Annual Scientific Session together with the World Congress of Cardiology in March. The near-term data will include the potential effect of Andexxa versus four-factor PCC on 30-day mortality. This retrospective analysis is based on comparing propensity matched Factor Xa-treated population from the ANNEXA-4 study and the Orange [Phonetic] Registry.

I look forward to providing more details at the Q1 call. With that, I will hand the call over to Scott for closing remarks.

Scott Garland -- President and Chief Executive Officer

Thank you, Rajiv. I'd like to leave you with four key takeaways from this call. First, we're confident that Andexxa will become the standard of care for patients taking apixaban and rivaroxaban that experience life-threatening bleeds. Second, we have several near-term catalysts for Andexxa in the United States, including new programs to drive broader adoption. Third, the initial traction from our European launch Ondexxya demonstrates the unmet need and acceptance among physicians and pharmacists in Europe. And finally, we're streamlining our spend and have cash resources for significant growth milestones for Andexxa in the United States and Europe.

I want to thank you for your continued interest in Portola. And with that, I'll turn it over to questions. Operator?

Questions and Answers:

Operator

Thank you. [Operator Instructions] Our first question comes from Vikram Purohit of Morgan Stanley. Your line is open.

Vikram Purohit -- Morgan Stanley & Co. -- Analyst

Hi. Thanks for taking my question. Two from my side, both kind of focused on the utilization reviews that you alluded to when you pre-announced 4Q '19 sales. So first off, I wanted to see if you have any visibility into how utilization has trended in the Tier 1 centers that were reported to have been stated DURs in 4Q '19? And then secondly, to the extent you have visibility on the topic, do you know of any additional centers year-to-date 2020 that have been stated similar DURs?

Scott Garland -- President and Chief Executive Officer

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 line 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 DURs for 2019, I will turn it over to Sheldon who provides additional color.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Thank you Scott. Hi, Vikram. Thanks for the question. So as it relates to fourth quarter, not too much more additional that we have not already stated when we were at JPMorgan, but just a few things I do want to add, and that is I reinforced as we talked about the drug utilization reviews when we did our pre-announce. First, again, institutions are always going to conduct drug utilization reviews. This is common among all hospital products, not just Andexxa. These can happen on a daily basis, a weekly basis, a monthly basis. I think for us, though, the opportunity that exists is we can -- as these DURs continue, we can actually help institutions better inform their decisions. As you heard Rajiv mention, we have new data that will be coming out at ACC that's truly going to point to the value proposition of Andexxa. And we'll be able to utilize that data as we move forward through 2020 as institutions evaluate and perform drug utilization reviews.

Scott Garland -- President and Chief Executive Officer

And maybe just add one other point, Vikram. One of the things that we do know is that not all drug utilization 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 have been increased usage. So I wanted to make sure that that was clear to you as well.

Vikram Purohit -- Morgan Stanley & Co. -- Analyst

Okay, fair enough. Thanks.

Operator

Thank you. Our next question comes from Matt Phipps of William Blair. Your line is open.

Matt Phipps -- William Blair and Company -- Analyst

Hi. Great. Thanks for taking my questions. Two. One on the surgery study. I know it says potential to give Andexxa for 6.5 hours in that trial, I guess, and just kind of comment on that. And then, are you going to be able to look at a correlation between Factor Xa activity -- inhibitor activity and the surgeon assessment 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.

Rajiv Patni -- Executive Vice President, Chief Medical Officer

Hi. It's Rajeev. Thanks for the question. So on the first question about the single-arm surgery study, just remind you that a key intent of that study is to inform the randomized controlled trials and part of that informing is dosing of Andexxa in the operating room. And you are correct that if the surgery goes beyond two hours, we do allow the surgeon to consider incremental dosing based on clinical need. And the second point you raised about can we take anti-Factor Xa levels and correlate that with a clinical outcome measure, in this case, the surgical assessment of hemostasis, the answer is that something we would do in our analysis plan. As you may recall, in the ANNEXA-4 publication, we presented data from that trial to characterize 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 controlled trials to build on that correlation database.

Scott Garland -- President and Chief Executive Officer

And maybe just to clarify, if you remember from ANNEXA-4 Matt, the correlation did hold in the intracranial hemorrhage population. So we think that was because of the fidelity that you have in measuring a 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 ANNEXA-4 in the ICH population.

Matt Phipps -- William Blair and Company -- Analyst

Thanks. And then if I can follow-up on Europe. I guess one question is, as we get closer to the NICE judgment, I mean, is there -- so we almost just assume they might be negatively biased just because that's how NICE often is around first assessments, particularly for maybe accelerated approval type drugs. And then also just wonder if you comment on the agreement with Inceptua on some of the Wave 2 countries and how that might impact the eventual expansion of those countries.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Yeah. Hi, Matt. It's Sheldon. First, let me speak to NICE. What I would say to that is we are not thinking of it as it could be a negative outcome, etc. We're actively negotiating with NICE. We feel as though we've put together a very comprehensive dossier, and 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 2020. And as it relates to Inceptua for the Wave 2 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, so they would want to use the product. And again, what we want to do is, we want to maximize in a very lean fashion our footprint in Europe. And this is the best way to do that by signing on Inceptua to help us do this.

Scott Garland -- President and Chief Executive Officer

And maybe, Matt, back to the NICE and this, I think, is also relevant to the AMNOG discussion. 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 an instance, in the case of the GB and others, a quantification of no additional benefit. That's standard when you have a product that -- like Andexxa that did a single-arm clinical trial. I think one of the things that really was impressive that Sheldon mentioned on the call was the relative interest for the hospitals in Germany. We had over 600 hospitals apply for the NUB. That was, as we said, the second highest that we've seen for a product launched in Germany. So we believe the physician support is there, but the negotiations are influenced by the data package, and having a -- not having randomized trial can influence the conversations.

Matt Phipps -- William Blair and Company -- Analyst

Thanks.

Operator

Thank you. Our next question comes from Tiago Fauth of Credit Suisse. Your line is open.

Tiago Fauth -- Credit Suisse Securities -- Analyst

Hey, guys. Thanks for taking the question. So actually wanted to explore NTAP being a potential driver of greater utilization. So just curious if you have any data on utilization in hospitals where NTAP is actually being correctly applied for. And it's meaningfully different in hospitals that may not be fully taking advantage of NTAP for whatever reason and would benefit from some of the initiatives you guys are undertaking. Thanks.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Sure. So, hi, Tiago. Thanks for your question. And let me speak to -- the question is related to NTAP. We don't have a lot of wholesome data yet as it relates to NTAP; it's just something provided by the CMS. To the point that you made, NTAP is underutilized. And it's our mission to pave the way to, one, really have NTAP recognized as a way for these institutions to get a reimbursement as high as 65% to the cost of Andexxa. I cannot emphasize that enough. With that said, what we do know, speaking to the underutilization of NTAP, we know that for those institutions that could apply for an NTAP about 25 -- only 25% of them have been applied for the NTAP. What we see is that those who do apply for the NTAP, more than 90% of them actually receive an NTAP reimbursement. So we know that it works. So just some of the things that we're doing, we just hired a institution reimbursement manager. We're going to have a few other of these people who are actually going to work with those institutions, who we know where opportunity exists, where they could actually be applying for the NTAP. Actually next week, we're rolling out what's called the Portola Access Navigator. And this is going to be a tool that will be completely directed at hospital administrators, billers and coders of institutions. So we will be doing that very proactively. Again, I think our mission is to really pave the way so that there's recognition of the NTAP and that it is utilized on a routine basis.

Tiago Fauth -- Credit Suisse Securities -- Analyst

Got it. Thanks.

Operator

Thank you. Our next question is from Yigal Nochomovitz of Citigroup. Your line is open.

Yigal Nochomovitz -- Citigroup -- Analyst

Yeah. Hi. Thanks for taking the questions. Just a few more on the NTAP. I guess, given the new initiatives that you're unveiling, including I think I heard a call center. Could you just give us some realistic assessment or appraisal of what percent of eligible NTAP cases you believe are going to be passing through the NTAP process, sort of in the next 12 months? What can you realistically go from the 25%? Thanks.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Yeah. Thanks, Yigal. So we do not have a specific number that we're targeting. What we're really doing is applying this effort to get to as many institutions as possible. Keep in mind that all institutions are eligible to actually apply for the NTAP. So when you think about our target audience of 2,100 institutions that are out there, all 2,100 of those institutions, even those are non-target, they have the ability to -- able to apply for the NTAP. And we're making sure also -- I just want to reinforce, there's some other things that we're involved with where we're going to be speaking to some very high level administrators, C-suite, etc. of these institutions to integrate delivery networks to get some of the plans that I mentioned a little bit earlier 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 reimbursement managers are experts in the EMR system that exist in these hospitals as typically have a Cerner, and they're able to actually identify the way to automatically apply specific ERG codes to the NTAP application, so it removes the manual aspect, which is tedious, tiresome and sometimes forgotten. So this is a way to help automate that system. One thing that I failed to mention on the last question that we've also opened as it relates to the NTAP is a call center. So our call centers are actually live right now. We guarantee that if a question is asked, there's an answer within 24 hours. And how that works is that all 116 of our representatives and our 16 medical liaisons, they all have a number to allow them to contact our call center with questions.

Yigal Nochomovitz -- Citigroup -- Analyst

Okay. Got it. And as far as tracking the usage of NTAP, 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. Is that going to change at any point such that the Street would have a more real time assessment of the usage of NTAP? Are we always going to be facing this six months lag from CMS?

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Yeah. So, I wish we could have some control over that. But it is going to be a six- to probably nine-month time lag. But I think, one thing we may be able to do as quarters go on, we can actually perhaps give qualitative feedback of where we've been successful in these initiatives, in that, they allow you to better gauge on what our success is.

Yigal Nochomovitz -- Citigroup -- Analyst

Okay. Thank you.

Operator

Thank you. Our next question comes from John McNeil of Goldman Sachs. Your line is open.

John McNeil -- Goldman Sachs -- Analyst

Hi there, guys. Thanks so much for taking the question. I maybe wanted to start by given that we're more than halfway through 1Q '20, if you could provide any feedback on maybe what you've seen Andexxa trending like so far? And then I've a follow-up after that. Thanks.

Scott Garland -- President and Chief Executive Officer

Sure, John. As I said, I think on the question that Vikram asked at the beginning, as is our standard practice, we don't comment on a quarter, until the quarter is done. This call is about Q4 and year-end. We do look forward to providing you an update in -- on our Q1 progress and that would be in our May call. And you said, you had a follow-up question.

John McNeil -- Goldman Sachs -- Analyst

Yes. And maybe just as you look at the rest of the year, do you think there are any other places either this year or maybe next year where you could see potential for more cost saves or more kind of rightsizing your operating structure?

Mardi C. Dier -- Executive Vice President, Chief Financial Officer and Chief Business Officer

Yeah. Hi, John. This is Mardi. Thanks for the question. So as we said on the call, we are aligning the business to Andexxa and we've done a good job streamlining our expenses. But we are making the right investments, right? So we are making the investments in the data that Rajiv spoke about and clinical data, real-world data and label expansion work for Andexxa as well as our geographic expansion. So more work in Europe. And we had the full year effect of our sales force in Europe, as well as a full year impact in 2020 of our operations in Europe. So we need this to drive revenue going forward. So what you're not seeing in 2020 that are expenses regarding, for example, the CELTIC-1 study for cerdulatinib and all the costs related to that and some of our early development work. So we feel pretty good about the opex structure for Portola right now, and we think that it's pretty close to the structure that you're going to see actually beyond 2020. And then the last point I'll make on that is, we've done a benchmarking effort with 25 commercial companies in our peer group looking at opex expense for companies that have some R&D and commercial efforts. Most of this don't have a European effort as well. And I would say we are smack in the middle of [Indecipherable] low end of total opex expense. So we feel like we've done a good job streamlining and taking important steps to focus what we think are the growth drivers of the business, and that's where it's going to stay for now in the next couple of years.

John McNeil -- Goldman Sachs -- Analyst

Great. Thank you so much, Mardi.

Operator

Thank you. Our next question comes from Jay Olson of Oppenheimer. Your line is open.

Jay Olson -- Oppenheimer & Co. -- Analyst

Hi. Thanks for taking the questions. I was wondering if you could confirm that the NTAP reimbursement can be applied for retroactively, and are there any time limitations as far as how far back you can go to apply for NTAP reimbursement?

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Yes. Hi, Jay. So, yes, so you can go and you can retroactively apply for the NTAP. 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 NTAP. And we are actually reminding customers of this. One last thing to that, because I know you're always interested in educational opportunities and things that we've done in the past and about two, three weeks ago, we actually attended congress of billers and coders. These are people that works specifically in the hospital. They're responsible for all the coding, so that bills can be created within these institutions. And we went there, we presented some of the work that we'll be doing. We talked about the fact that, again, the availability of the NTAP that it allows for up to 65% reimbursement. And then also to your question, you can retroactively go back and apply for this. We also talked about, as I mentioned, some of the resources available.

Jay Olson -- Oppenheimer & Co. -- Analyst

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 NTAP educational program?

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Well, yeah. So actually, I attended the International Stroke Conference last week in Los Angeles. I was at a dinner program, and I happened to be -- this was a dinner program of about 70 people. And there are some folks at the table, and by the way, the attendees of this are stroke coordinators, neurologists, emergency room physicians, etc. So these are people directly working at large institutions, some small institutions dealing with patient care. And we are talking about the impact, this is right after the speaker was done. There happen to be some individuals from Connecticut, from an institution they're talking about the NTAP and they are talking about -- telling them about the fact that we have these institutional reimbursement managers and this woman kind of I'm not kidding, so -- almost jumped out of her seat, said, oh, yeah, we met her. She was just at our institution. As a matter of fact the hospital would be, we'd love to hire her, but she's working for you. And she talked about how she's already helped the institution a great deal. The week before, she was actually up in Boston working with some folks there. We're actually also partnering with John Fanikos, who you actually saw at our Analyst Day back in November who, by the way, as you may recall, is a big user of the NTAP, and it actually shows how the NTAP can allow you, as we said in our script today, to breakeven on the costs related to Andexxa. So that's just one story. And she has only just started, OK? So very, very encouraged.

Jay Olson -- Oppenheimer & Co. -- Analyst

Well, it's great feedback. Thanks for that color. If I could ask about cerdulatinib and the decision not to initiate the CELTIC-1 trial. Can you comment on the types of partnerships you're considering, and I guess sort of the process you're going through there?

Mardi C. Dier -- Executive Vice President, Chief Financial Officer and Chief Business Officer

Yeah. Hi, Jay. It's Mardi again. I think we talked about this before. We'll look at all types of partnerships for cerdulatinib. We really believe the asset in not only PTCL, where we've shown some excellent data in a sub-type called AITL, but also what we're showing in follicular in combination with rituximab and potential for other combinations that this drug needs to be in a home where they focus more on oncology and can really put out a full development plan to develop it the proper way. So, we're looking for all types of partnerships for this asset. And like we said, we like what we're seeing with follicular in combination with rituximab. We showed that data at ASH last December and we're keeping a study ongoing that could be interesting, showing that same combination at a more dose that would help in inform partnering efforts. So that's what we're doing with cerdulatinib.

Jay Olson -- Oppenheimer & Co. -- Analyst

Okay, great. Thanks for taking the questions.

Operator

Thank you. Your next question comes from Kenneth Atkins of Cowen. Your line is open.

Kenneth Atkins -- Cowen & Company -- Analyst

Hi. Thanks for taking my question. Do you have any visibility into how exactly hospitals undertook DURs in Q4, changed [Technical Issues] Andexxa, which patients who would have gotten Andexxa are no longer getting it?

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

So, yeah, happy to address that. So again, to Scott's point, as it relates to drug utilization review, there is -- some institutions that perform these drug utilization reviews have reaffirmed their use of Andexxa. 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 Andexxa. If anything, their use might have declined a bit, as we also mentioned during the preannouncement at JPMorgan. We saw them rise up to a level of stabilization. We don't really have insight into each specific institution of where they use Andexxa. But what I can tell you is that we conduct a chart on it on a quarterly basis. We just received actually our results from the fourth quarter perspective. And when you look at Andexxa and the utilization of Andexxa, it's used across all different lead types. So it's used in ICH, it's used in GI, it's used in trauma-related compartmental bleeds. So for me to say it's only being used specifically in one area or another specific institution, we feel that the chart on it is a very nice sample. It gives us an idea of where the drug is being used. The last thing I would say to that is, we spend a lot of time out in the field, listening to our field. We go to lot of these institutions and we hear where Andexxa is used in multiple different cases. And you may recall, in the script, I actually talked about the fact where Andexxa was not used in the case of an aortic dissection. Let's just give you an example of, where the drug potentially could have been used. We heard in a similar case where Andexxa was used in aortic dissection. The patient was transported to a large medical center here in California. And that patient actually survived. So that would be an example of a bleed type that's different than ICH, different than GI. But it shows you the variability of these different bleed types.

Kenneth Atkins -- Cowen & Company -- Analyst

Okay. Thanks.

Operator

Thank you. Our next question comes from Mike Phipps of William Blair. Your line is open.

Matt Phipps -- William Blair and Company -- Analyst

Yeah. Thanks for taking the follow-up question. Sheldon, you obviously talked a lot about NTAP education. But the article that you talked about where the patient died because the hospital didn't have Andexxa, apparently the hospital also didn't know about the consignment program. Is that something that you're going to use at all, and you think, is that part of the education process?

And similarly, I guess, C-code usage, has that been anything incremental? And then are you all still under the impression that Andexxa will either receive a DRG code in Q4 or maybe recalculating the DRG codes for these types of bleeds?

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

So let me first start with consignment. Consignment is something that I would say that everybody is aware of. And I would -- and I know that this institution was aware of consignment. So I'll stop there with that. As it relates to the C-code, well, we don't have yet as we don't have any data related to the C-code. And this is similar to the NTAP with 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 on Andexxa and ship them to a Level 1 trauma center, etc. By the way, I just want to mention, in your -- just going back to your first question, institutions such as the example that we gave during the script, they could have used the C-code as well. They could have used the C-code, started the patient and transported them. But again, to your point, they could have qualified and they didn't qualify to find a product that there's just a choice that they did not. And you had one other sub-question there.

Matt Phipps -- William Blair and Company -- Analyst

DRG update.

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

DRG update. So as it relates to the DRG update, we are currently working with CMS. I've no real further update to give at this point. What I would say is that there is approximately 57 DRGs that are currently out there that can be linked to the use of Andexxa. Again, all these DRGs were developed before Andexxa was ever developed. But we are currently working with CMS, and as we continue to have updates on that, we'll provide you. Actually I had the opportunity to meet with the Secretary of CMS, Seema Verma at JPMorgan. We are one of two other companies that were able to get 45 [Phonetic] minutes and chat with her. And we talked about all these things actually that are being discussed today.

Matt Phipps -- William Blair and Company -- Analyst

Thanks. So then I guess, Rajiv, if I can ask you one as well. You kind of talked about the potential ability to get supplemental filing for edoxaban and enoxaparin. I know you guys just published some Phase 2 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 at additional studies may be undertaken to reinforce the effect of Andexxa, if I heard that correctly. Can you elaborate on that at all?

Rajiv Patni -- Executive Vice President, Chief Medical Officer

So on the first question, ANNEXA-4, as I said in my prepared remarks, is a rich source of data. And that rich source of data includes patients who were treated with edoxaban and enoxaparin. So our thinking is to share those data with the FDA and to find a path forward to that potential label expansion. On your second question about additional studies to further characterize the pharmacodynamic profile of Andexxa, I would leave that to the next call. We're thinking about again holistically how we advance this evidence base and what's the most meaningful studies are to do that. So I will be prepared with the rest of the team to talk about that in the next call.

Scott Garland -- President and Chief Executive Officer

Maybe just to clarify, Matt, two of those were not linked to one another. We believe we have sufficient data from ANNEXA-4 to approach the FDA to have a conversation. So it wasn't about doing additional studies with edoxaban and enoxaparin. But we'll certainly provide updates going forward.

Pamela Conley -- Senior Vice President of Research

Yes. Hi, Matt. This is Pam. Just to comment on the paper that was just published that edoxaban data will be used, as Rajiv said, in combination with ANNEXA-4 data to become part of our potential label expansion filing for edoxaban.

Matt Phipps -- William Blair and Company -- Analyst

Great, thanks for taking my follow-ups.

Operator

Thank you. I'm showing no further questions at this time. I would like to turn the call back over to Scott Garland for any closing remarks.

Scott Garland -- President and Chief Executive Officer

Great. Thank you, operator. I just want to reiterate some of the key themes from our call today. First, we remain confident in both the near and the long term growth potential for Andexxa. That's based on the fact that Andexxa is a novel breakthrough drug. It's the only FDA or EMA approved agent for the reversal of Factor Xa inhibitors. The Xa inhibitor market is a very large and growing market as we talked about on prior calls. The number of patients that are taking Xa inhibitors is growing at least in 2019 at a nearly 20% rate.

We have opportunities to expand the label for Andexxa, we talked about on the call today, opportunities to expand geographically, and of course, when the Factor Xa inhibitors start going generic in 2023 and 2024, we expect the use of those drugs to expand beyond what we're currently seeing today. The second key point is that we have catalysts both in the near and longer term to drive growth. And then the final piece is that we are making the right investments to drive growth for Andexxa.

So I want to end on those comments. I want to thank you for your time and attention. We look forward to updating you in the future. Take care.

Operator

[Operator Closing Remarks]

Duration: 50 minutes

Call participants:

Jennifer Zibuda -- Senior Manager, Investor Relations

Scott Garland -- President and Chief Executive Officer

Mardi C. Dier -- Executive Vice President, Chief Financial Officer and Chief Business Officer

Sheldon Koenig -- Executive Vice President, Chief Commercial Office

Rajiv Patni -- Executive Vice President, Chief Medical Officer

Pamela Conley -- Senior Vice President of Research

Vikram Purohit -- Morgan Stanley & Co. -- Analyst

Matt Phipps -- William Blair and Company -- Analyst

Tiago Fauth -- Credit Suisse Securities -- Analyst

Yigal Nochomovitz -- Citigroup -- Analyst

John McNeil -- Goldman Sachs -- Analyst

Jay Olson -- Oppenheimer & Co. -- Analyst

Kenneth Atkins -- Cowen & Company -- Analyst

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