Acorda Provides Financial and Pipeline Update for Third Quarter 2018

Date : 10/31/2018 @ 10:00AM
Source : Business Wire
Stock : Acorda Therapeutics, Inc. (ACOR)
Quote : 18.97  0.0 (0.00%) @ 12:00PM

Acorda Provides Financial and Pipeline Update for Third Quarter 2018

Acorda Therapeutics, Inc. (NASDAQ:ACOR)
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  • AMPYRA® (dalfampridine) Q3 2018 net revenue of $138 million; 2018 net revenue guidance increased from $330-$350 million to more than $400 million
  • Cash balance for year-end 2018 revised from more than $300 million to more than $400 million
  • INBRIJA™ (levodopa inhalation powder) PDUFA date January 5, 2019

Acorda Therapeutics, Inc. (Nasdaq:ACOR) provided a financial and pipeline update for the third quarter ended September 30, 2018.

“Acorda’s highest priority is preparing for the expected launch of Inbrija. Our market research indicates that healthcare professionals, patients and care partners consider OFF periods, or the re-emergence of Parkinson’s symptoms, to be one of the most significant unmet needs in Parkinson’s, and that they are enthusiastic about the prospect of an inhaled formulation of levodopa as a treatment option,” said Ron Cohen, M.D., Acorda's President and CEO.

“We were disappointed and disagree with the decision of the Federal appeals court regarding Ampyra, and we have filed an en banc petition requesting review by the entire court. At the same time, we were prepared for that potential outcome, and our original projections had us well capitalized to fully fund the launch of Inbrija and to develop the ARCUS pipeline. We have taken several steps over the past year both to conserve and to increase cash. Based on these, as well as greater than forecasted Ampyra sales, we are in now in an even stronger financial position, and are increasing our guidance for both cash and Ampyra sales in 2018.”

Third Quarter 2018 Financial Results

AMPYRA® (dalfampridine) Extended Release Tablets, 10 mg - For the quarter ended September 30, 2018, the Company reported AMPYRA net revenue of $137.8 million compared to $132.6 million for the same quarter in 2017.

Research and development (R&D) expenses for the quarter ended September 30, 2018 were $22.9 million, including $1.1 million of share-based compensation compared to $33.3 million, including $2.0 million of share-based compensation, for the same quarter in 2017.

Sales, general and administrative (SG&A) expenses for the quarter ended September 30, 2018 were $43.6 million, including $4.0 million of share-based compensation compared to $40.7 million, including $4.6 million of share-based compensation for the same quarter in 2017.

Provision for income taxes for the quarter ended September 30, 2018 was $38.0 million, including $3.1 million of cash taxes, compared to a provision for income taxes of $18.9 million, including $3.7 million of cash taxes, for the same quarter in 2017.

The Company reported a GAAP net loss of $(13.9) million for the quarter ended September 30, 2018, or $(0.29) per diluted share. GAAP net loss in the same quarter of 2017 was $(25.2) million, or $(0.55) per diluted share.

Non-GAAP net income for the quarter ended September 30, 2018 was $8.1 million, or $0.17 per diluted share. Non-GAAP net income in the same quarter of 2017 was $20.1 million, or $0.43 per diluted share. This quarterly non-GAAP net income measure, more fully described below under “Non-GAAP Financial Measures,” excludes share-based compensation charges, non-cash interest charges on our debt, changes in the fair value of acquired contingent consideration, intangible asset impairment charges, and restructuring costs. A reconciliation of the GAAP financial results to non-GAAP financial results is included with the attached financial statements.

At September 30, 2018, the Company had cash, cash equivalents and short-term investments of $460.9 million.

Guidance for 2018

  • AMPYRA 2018 net revenue guidance increased from $330-$350 million to more than $400 million.
  • R&D expenses for the full year 2018 reiterated and expected to be $100-$110 million including pre-launch manufacturing expenses associated with INBRIJA. This guidance is a non-GAAP projection that excludes share-based compensation, as more fully described below under “Non-GAAP Financial Measures.”
  • SG&A expenses for the full year 2018 reiterated and expected to be $170-$180 million. This guidance is a non-GAAP projection that excludes share-based compensation, as more fully described below under “Non-GAAP Financial Measures.”
  • The Company has increased projected 2018 year-end cash balance from more than $300 million to more than $400 million.

Third Quarter 2018 Highlights

  • INBRIJA™ (levodopa inhalation powder) in Parkinson’s disease
    • In September, the FDA extended the PDUFA goal date for its review of the New Drug Application (NDA) of INBRIJA from October 5, 2018 to January 5, 2019 based on submissions the Company made in response to requests from FDA for additional information on chemistry, manufacturing and controls (CMC). FDA determined that these submissions constituted a major amendment and will take additional time to review.
    • The Company reported that the inspection of its Chelsea, Massachusetts manufacturing facility and the Inbrija inhaler device manufacturer's facility were successfully completed and closed without need for any further action by the FDA.
    • INBRIJA is an investigational treatment for symptoms of OFF periods in people with Parkinson’s disease taking a carbidopa/levodopa regimen.
  • AMPYRA (dalfampridine)
    • In September, the United States Court of Appeals for the Federal Circuit, by a 2-1 vote, upheld the United States District Court for the District of Delaware’s decision to invalidate four Ampyra patents.
    • In October, the Company filed a petition for en banc hearing with the United States Court of Appeals for the Federal Circuit.
    • The Company announced that it had settled with Mylan AG to market an authorized generic version of Ampyra. In mid-September, Mylan announced the U.S. launch of the authorized generic.

Webcast and Conference Call

The Company will host a conference call today at 8:30 a.m. ET. To participate in the conference call, please dial (833) 236-2756 (domestic) or (647) 689-4181 (international) and reference the access code 4468928. The presentation will be available on the Investors section of www.acorda.com. A replay of the call will be available from 11:30 a.m. ET on October 31, 2018 until 11:59 p.m. ET on November 30, 2018. To access the replay, please dial (800) 585-8367 (domestic) or (416) 621-4642 (international); reference code 4468928. The archived webcast will be available in the Investor Relations section of the Acorda website at www.acorda.com.

About Acorda Therapeutics

Acorda Therapeutics develops therapies to restore function and improve the lives of people with neurological disorders. INBRIJA™ (levodopa inhalation powder), an investigational inhaled formulation of levodopa for symptoms of OFF periods for people with Parkinson’s on a carbidopa/levodopa regimen, is under FDA review with a PDUFA date of January 5, 2019. INBRIJA utilizes Acorda’s innovative ARCUS® pulmonary delivery system, a technology platform designed to deliver medication through inhalation. Acorda also markets the branded AMPYRA® (dalfampridine) Extended Release Tablets, 10 mg.

Forward-Looking Statement

This press release includes forward-looking statements. All statements, other than statements of historical facts, regarding management's expectations, beliefs, goals, plans or prospects should be considered forward-looking. These statements are subject to risks and uncertainties that could cause actual results to differ materially, including: the ability to realize the benefits anticipated from acquisitions, among other reasons because acquired development programs are generally subject to all the risks inherent in the drug development process and our knowledge of the risks specifically relevant to acquired programs generally improves over time; we may need to raise additional funds to finance our operations and may not be able to do so on acceptable terms; increasing competition and accompanying loss of revenues in the U.S. from generic versions of Ampyra (dalfampridine) following our loss of patent exclusivity; the risk of unfavorable results from future studies of Inbrija (levodopa inhalation powder) or from our other research and development programs, or any other acquired or in-licensed programs; we may not be able to complete development of, obtain regulatory approval for, or successfully market Inbrija or any other products under development; risks associated with complex, regulated manufacturing processes for pharmaceuticals, which could affect whether we have sufficient commercial supply of Inbrija to meet market demand, if it receives regulatory approval; third party payers (including governmental agencies) may not reimburse for the use of Ampyra, Inbrija or our other products at acceptable rates or at all and may impose restrictive prior authorization requirements that limit or block prescriptions; the occurrence of adverse safety events with our products; the outcome (by judgment or settlement) and costs of legal, administrative or regulatory proceedings, investigations or inspections, including, without limitation, collective, representative or class action litigation; competition; failure to protect our intellectual property, to defend against the intellectual property claims of others or to obtain third party intellectual property licenses needed for the commercialization of our products; and failure to comply with regulatory requirements could result in adverse action by regulatory agencies.

These and other risks are described in greater detail in our filings with the Securities and Exchange Commission. We may not actually achieve the goals or plans described in our forward-looking statements, and investors should not place undue reliance on these statements. Forward-looking statements made in this press release are made only as of the date hereof, and we disclaim any intent or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.

Non-GAAP Financial Measures

This press release includes financial results prepared in accordance with accounting principles generally accepted in the United States (GAAP), and also certain historical and forward-looking non-GAAP financial measures. In particular, Acorda has provided non-GAAP net income, adjusted to exclude the items below, and has provided 2018 guidance for R&D and SG&A expenses on a non-GAAP basis. Non-GAAP financial measures are not an alternative for financial measures prepared in accordance with GAAP. However, the Company believes the presentation of non-GAAP net income, when viewed in conjunction with our GAAP results, provides investors with a more meaningful understanding of our ongoing and projected operating performance because this measure excludes (i) non-cash compensation charges and benefits that are substantially dependent on changes in the market price of our common stock, (ii) non-cash interest charges related to the accounting for our outstanding convertible debt which are in excess of the actual interest expense owing on such convertible debt, as well as non-cash interest charges related to the Fampyra royalty monetization, the asset based loan which was terminated in 2017 and acquired Biotie debt, (iii) changes in the fair value of acquired contingent consideration which do not correlate to our actual cash payment obligations in the relevant periods, (iv) acquisition related expenses and related foreign currency losses that pertain to a non-recurring event, (v) expenses that pertain to non-routine restructuring events, and (vi) intangible asset impairment charges that pertain to a non-recurring event. The Company believes its non-GAAP net income measure helps indicate underlying trends in the Company's business and is important in comparing current results with prior period results and understanding projected operating performance. Also, management uses this non-GAAP financial measure to establish budgets and operational goals, and to manage the Company's business and to evaluate its performance.

In addition to non-GAAP net income, we have provided 2018 guidance for R&D and SG&A expenses on a non-GAAP basis. Due to the forward looking nature of this information, the amount of compensation charges and benefits needed to reconcile these measures to the most directly comparable GAAP financial measures is dependent on future changes in the market price of our common stock and is not available at this time. The Company believes that these non-GAAP measures, when viewed in conjunction with our GAAP results, provide investors with a more meaningful understanding of our ongoing and projected R&D and SG&A expenses. Also, management uses these non-GAAP financial measures to establish budgets and operational goals, and to manage the Company's business and to evaluate its performance.

Financial Statements

  Acorda Therapeutics, Inc. Condensed Consolidated Balance Sheet Data (in thousands) (unaudited)     September 30,     December 31, 2018 2017   Assets Cash, cash equivalents and short-term investments $ 460,946 $ 307,068 Trade receivable, net 51,461 81,403 Other current assets 23,388 15,726 Finished goods inventory 10,800 37,501 Property and equipment, net 52,061 36,669 Goodwill 283,435 286,611 Intangible assets, net 428,575 430,603 Other assets   419   2,388 Total assets $ 1,311,085 $ 1,197,969   Liabilities and stockholders' equity Accounts payable, accrued expenses and other current liabilities $ 127,370 $ 127,495 Current portion of deferred license revenue — 9,057 Current portion of royalty liability 7,714 6,763 Current portion of loans payable 624 645 Convertible senior notes 316,160 308,805 Contingent consideration 131,229 112,722 Non-current portion of deferred license revenue — 23,398 Non-current portion of royalty liability 24,251 29,025 Non-current portion of loans payable 24,673 25,670 Deferred tax liability 70,656 22,459 Other long-term liabilities 9,783 11,943 Total stockholder's equity   598,625   519,987 Total liabilities and stockholders' equity $ 1,311,085 $ 1,197,969     Acorda Therapeutics, Inc. Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited)     Three Months Ended     Nine Months Ended September 30, September 30, 2018   2017 2018   2017         Revenues: Net product revenues $ 139,973 $ 134,357 $ 393,388 $ 379,705 Royalty revenues 2,841 4,444 8,893 13,391 License revenue     —       2,264       —       6,793   Total revenues 142,814 141,065 402,281 399,889   Costs and expenses: Cost of sales 25,391 29,992 77,834 84,840 Cost of license revenue — 159 — 476 Research and development 22,855 33,286 79,325 130,963 Selling, general and administrative 43,571 40,741 135,435 141,780 Asset impairment — 39,446 — 39,446 Acquisition related expenses — — — 320 Change in fair value of acquired

contingent consideration

    22,700       (400 )     21,900       16,800   Total operating expenses 114,517 143,224 314,494 414,625                         Operating income (loss) $ 28,297 $ (2,159 ) $ 87,787 $ (14,736 )   Other expense, (net)     (4,240 )     (4,168 )     (13,898 )     (14,138 ) Income (loss) before income taxes 24,057 (6,327 ) 73,889 (28,874 ) Provision for income taxes     (37,968 )     (18,868 )     (49,802 )     (23,421 ) Net (loss) income $   (13,911 ) $   (25,195 ) $   24,087   $   (52,295 )   Net (loss) income per common share - basic $ (0.29 ) $ (0.55 ) $ 0.51 $ (1.14 ) Net (loss) income per common share - diluted $ (0.29 ) $ (0.55 ) $ 0.51 $ (1.14 ) Weighted average common shares - basic 47,184 46,002 46,840 45,918 Weighted average common shares - diluted 47,184 46,002 47,251 45,918     Acorda Therapeutics, Inc. Non-GAAP Income and Income per Common Share Reconciliation (in thousands, except per share amounts) (unaudited)     Three Months Ended     Nine Months Ended September 30, September 30, 2018   2017 2018   2017         GAAP net (loss) income $ (13,911 ) $ (25,195 ) $ 24,087 $ (52,295 ) Pro forma adjustments: Non-cash interest expense (1) 3,944 2,553 11,917 8,918   Change in fair value of acquired

contingent consideration (2)

22,700 (400 ) 21,900 16,800   Restructuring costs (3) 4 34 1,320 7,625   Acquisition related expenses (4) — — — 320   Realized foreign currency loss (5) — — — 247   Asset impairment charge (6) — 39,446 — 39,446   Share-based compensation expenses

included in R&D

1,112 2,041 4,336 8,401 Share-based compensation expenses

included in SG&A

    4,023       4,630       11,910       17,820   Total share-based compensation expenses 5,135 6,671 16,246 26,221                         Total pro forma adjustments 31,783 48,304 51,383 99,577   Income tax effect of reconciling items

above (7)

9,729 3,041 (6,427 ) 19,877                         Non-GAAP net income $   8,143   $   20,068   $   81,897   $   27,405     Net income per common share - basic $ 0.17 $ 0.44 $ 1.75 $ 0.60 Net income per common share - diluted $ 0.17 $ 0.43 $ 1.73 $ 0.60 Weighted average common shares - basic 47,184 46,002 46,840 45,918 Weighted average common shares - diluted 47,563 46,174 47,251 46,049  

(1)

 

Non-cash interest expense related to convertible senior notes, asset based loan (which was terminated in Q2 2017), Biotie non-convertible and R&D loans and Fampyra royalty monetization.

(2)

Changes in fair value of acquired contingent consideration related to the Civitas transaction.

(3)

Restructuring costs associated with corporate restructuring initiatives.

(4)

Transaction expenses related to the Biotie acquisition.

(5)

Realized foreign currency transaction loss related to the Biotie acquisition.

(6)

Impairment charge related to the intangible asset for Selincro.

(7)

Represents the tax effect of the non-GAAP adjustments.

 

Acorda TherapeuticsFelicia Vonella, 914-326-5146fvonella@acorda.com

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