Acorda Loss Narrows on Ampyra Revs – Analyst Blog

Acorda Therapeutics Inc. (ACOR) reported a loss of 18 cents in the second quarter, well below the Zacks Consensus Estimate of a loss of 46 cents and the year ago loss of 62 cents. Higher revenues helped the company report a lower loss in the second quarter 2010.

 

Revenues increased a whopping 241.3% to $42.8 million in the second quarter. Second quarter revenues were well above the Zacks Consensus Estimate of $29 million with Ampyra sales exceeding expectations.

 

 

Second quarter revenues consisted of $40.5 million in product sales and $2.4 million in license fees. Gross sales of Ampyra, which was launched in Mar 2010, came in at $29.7 million.

 

Despite some inventory stocking during the quarter, Ampyra sales were impressive. The product is off to a strong start with about 4,200 physicians having written at least one prescription for the drug (as of Jul 30, 2010). Acorda is currently in discussions with managed care organizations regarding gaining formulary status for Ampyra. Increased formulary access should help drive Ampyra sales.

 

Zanaflex capsules and tablets recorded gross sales of $13.7 million in the second quarter, down 7.4% from the year-ago period. Revenues from Zanaflex capsules should continue declining in 2010.

 

While R&D expenses declined 16.2% to $6.6 million, SG&A expenses increased 42.6% to $34.1 million. The huge increase in SG&A spend was due to the company’s focus on the launch of Ampyra. We believe SG&A expenses will continue to increase as the company focuses its efforts on the successful commercialization of Ampyra.

 

 

We currently have a Neutral recommendation on Acorda which is supported by a Zacks #3 Rank (Hold). The successful commercialization of Ampyra should help the company achieve profitability next year. We expect investor focus to remain on the sales ramp-up of the product and its approval in the EU. Acorda’s partner, Biogen Idec (BIIB), is currently seeking regulatory approval for Ampyra in Canada and the EU and a response should be out in the first half of 2011.

 

Meanwhile, Acorda is looking to expand its portfolio by in-licensing a development or commercialization stage neurology product. We expect the company to announce a deal by year-end.