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Acorda Misses on Earnings, Beats Revs

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Acorda Therapeutics, Inc.’s (ACOR) first quarter earnings of 2 cents per share missed the Zacks Consensus Estimate of 4 cents. The company reported a loss of 3 cents per share in the year-ago quarter.

Total revenues for the quarter were $80.5 million, up 12.0% from the year-ago quarter. Revenues surpassed the Zacks Consensus Estimate of $79.0 million.

Quarter in Details

The bulk of net product revenues at Acorda came from Ampyra, which generated $72.5 million in the reported quarter, up 16.4% from the year-ago period. Ampyra revenues decreased 14.3% on a sequential basis.

Acorda’s Ampyra is marketed in the ex-U.S. markets under the trade name Fampyra by Biogen Idec (BIIB). Fampyra royalties declined 17.2% from the year-ago period to $2.4 million.

Zanaflex capsules and tablets recorded revenues of $3.1 million in the first quarter of 2014, down 29.5%. Acorda has authorized Actavis, Inc. (ACT) to commercialize the generic version of Zanaflex.

Acorda’s research and development (R&D) expenses increased 16.0% to $14.5 million (including $1.1 million of share-based compensation). Selling, general and administrative (SG&A) expenses came in at $46.9 million, down 2.7% from the year-ago period.

2014 Outlook Reiterated

Acorda reiterated its guidance for 2014. Ampyra sales are expected to increase in 2014 to $328–$335 million.

On the fourth quarter call, Acorda stated that it expects Zanaflex and Fampyra revenues to come around $25 million in 2014 and spend $60 million–$70 million on R&D.

Pipeline Update

Acorda received a setback earlier in the month when the U.S. Food and Drug Administration (:FDA) issued a Complete Response Letter (CRL) to its New Drug Application (:NDA) for Plumiaz nasal spray. Acorda is looking to get Plumiaz approved for the treatment of patients with epilepsy who experience cluster seizures. Consequently, Acorda does not expect Plumiaz to receive FDA approval in 2014.

Acorda will work closely with the FDA to address the issues outlined in the CRL and resubmit the NDA.

Meanwhile, Acorda expects to move a once-daily formulation of Ampyra into a phase III study for post-stroke deficits in the second half of 2014. Acorda resumed enrolment in the phase Ib trial on GGF2 which is being evaluated for chronic heart failure. Additionally, Acorda completed the dose escalation stage of its phase I trial on rHIgM22 for remyelination in multiple sclerosis (MS).  

Our Take

Acorda’s first quarter results were mixed. Although earnings missed expectations, revenues beat the same. We note that Acorda is overly dependent on Ampyra for top-line growth. Hence, the delay in Plumiaz's approval was disappointing. Acorda was planning a potential launch of Plumiaz in 2014. We expect investor focus to remain on Plumiaz updates.

Acorda carries a Zacks Rank #2 (Buy). A better-ranked stock in the biotech sector is Alexion Pharmaceuticals, Inc. (ALXN), carrying a Zacks Rank #1 (Strong Buy).

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