Acorda Therapeutics Provides Business Update and Reports Fourth Quarter and Full Year 2019 Financial Results

2020 Guidance:

  • Total net product revenue expected to be $120 - $150 million
  • INBRIJA® (levodopa inhalation powder) net revenue expected to be $35 - $40 million
  • INBRIJA peak sales revised to $300 - $500 million
  • AMPYRA® (dalfampridine) Extended Release Tablets, 10 mg. net revenue expected to be $85 - $110 million

ARDSLEY, N.Y.--()--Acorda Therapeutics, Inc. (Nasdaq: ACOR) today provided a business update and reported its financial results for the fourth quarter and full year ended December 31, 2019.

“INBRIJA’s launch was an important milestone for Acorda in 2019. It is the first and only approved inhalation therapy for the treatment of OFF periods in Parkinson’s disease. In 2020, our focus will be on increasing awareness of and driving demand for INBRIJA among people with Parkinson’s,” said Ron Cohen, M.D., Acorda’s President and Chief Executive Officer.

Dr. Cohen added, “Another top priority for 2020 is continuing to strengthen our capital structure and balance sheet. In December 2019 we successfully restructured the great majority of our convertible debt, and we have also reduced expenses significantly. We are working to identify additional opportunities to manage costs. These actions have helped position Acorda to deliver long-term value for our shareholders.”

Fourth Quarter 2019 Financial Results

For the fourth quarter ended December 31, 2019, the Company reported AMPYRA net revenue of $40.8 million compared to $64.2 million for the same quarter in 2018 and INBRIJA net revenue of $6.1 million.

Research and development (R&D) expenses for the quarter ended December 31, 2019 were $9.0 million, including $0.6 million of share-based compensation, compared to $27.1 million, including $1.2 million of share-based compensation, for the same quarter in 2018.

Sales, general and administrative (SG&A) expenses for the quarter ended December 31, 2019 were $41.2 million, including $2.0 million of share-based compensation, compared to $36.8 million, including $3.8 million of share-based compensation, for the same quarter in 2018.

Benefit from income taxes for the quarter ended December 31, 2019 was $0.8 million, compared to a benefit from income taxes of $63.1 million for the same quarter in 2018.

The Company reported GAAP net income of $65.7 million for the quarter ended December 31, 2019, or $1.38 per diluted share. GAAP net income in the same quarter of 2018 was $9.6 million, or $0.20 per diluted share.

Non-GAAP net loss for the quarter ended December 31, 2019 was $7.1 million, or $0.15 per diluted share. Non-GAAP net income in the same quarter of 2018 was $21.5 million, or $0.45 per diluted share. This quarterly non-GAAP net (loss) income measure, more fully described below under “Non-GAAP Financial Measures,” excludes share-based compensation charges, non-cash interest charges on our debt, restructuring expenses, changes in the fair value of acquired contingent consideration, goodwill impairment charges, gain on extinguishment of debt, and gain on sale of assets. A reconciliation of the GAAP financial results to non-GAAP financial results is included with the attached financial statements.

Full Year Ended December 31, 2019 Financial Results

For the full year ended December 31, 2019, the Company reported AMPYRA net revenue of $163.2 million compared to $455.1 million for the full year 2018 and INBRIJA net revenue of $15.3 million.

Research and development (R&D) expenses for the full year ended December 31, 2019 were $60.1 million, including $2.8 million of share-based compensation, compared to $106.4 million, including $5.6 million of share-based compensation for the full year 2018.

Sales, general and administrative (SG&A) expenses for the full year ended December 31, 2019 were $192.8 million, including $10.8 million of share-based compensation, compared to $172.3 million, including $15.7 million of share-based compensation for the full year 2018.

Benefit from income taxes for the full year ended December 31, 2019 was $1.3 million, compared to a benefit from income taxes of $13.3 million for the full year 2018.

For the full year ended December 31, 2019, the Company reported GAAP net loss of $273.0 million, or $5.75 per diluted share. GAAP net income for the full year 2018 was $33.7 million, or $0.71 per diluted share.

Non-GAAP net loss for the full year ended December 31, 2019 was $81.8 million, or $1.72 per diluted share. Non-GAAP net income for the full year ended December 31, 2018 was $103.4 million, or $2.18 per diluted share. This full year non-GAAP net (loss) income measure, more fully described below under “Non-GAAP Financial Measures,” excludes share-based compensation charges, non-cash interest charges on our debt, restructuring expenses, changes in the fair value of acquired contingent consideration, goodwill impairment charges, gain on extinguishment of debt, and gain on sale of assets. A reconciliation of the GAAP financial results to non-GAAP financial results is included with the attached financial statements.

At December 31, 2019, the Company had cash, cash equivalents, investments and restricted cash of $168.9 million. Restricted cash includes $42.7 million in escrow related to the 6% semi-annual interest portion, payable in cash or stock, of the convertible note exchange completed in December 2019. If the Company elects to pay interest due in stock, the restricted cash will be released from escrow.

2020 Financial Guidance

  • Total product net revenue for the full year 2020 is expected to be $120 - $150 million, with total revenue expected to be $130 - $160 million. Product revenue excludes royalty revenue, primarily Fampyra royalty revenue obligations owed to Healthcare Royalty Partners.
  • INBRIJA net revenue for the full year 2020 is expected to be $35 - $40 million.
  • Expected INBRIJA U.S. annual peak sales has been revised to $300 - $500 million
  • AMPYRA net revenue for the full year 2020 is expected to be $85 - $110 million.
  • Operating expenses for the full year 2020 are expected to be $170 - $180 million, reduced from previous guidance of $180 - $190 million. This guidance is a non-GAAP projection that excludes restructuring costs and share-based compensation as more fully described below under “Non-GAAP Financial Measures.”

Fourth Quarter 2019 Highlights

  • In December 2019, the Company successfully exchanged $276 million notional value of 2021 convertible notes, at a 5% discount, for $207 million of December 2024 secured convertible notes, convertible at a significant premium, and $55 million of cash.
  • In October 2019, the Company announced a corporate restructuring and 25% headcount reduction; more than $21 million in expected annualized cost savings expected.

Webcast and Conference Call

The Company will host a conference call and webcast in conjunction with its fourth quarter/year end 2019 update and financial results 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 4665685. 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 February 13, 2020 until 11:59 p.m. ET on March 12, 2020. To access the replay, please dial (800) 585-8367 (domestic) or (416) 621-4642 (international); reference code 4665685. The archived webcast will be available in the Investor Relations section of the Acorda website at www.acorda.com.

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 (loss) income, adjusted to exclude the items below, and has provided 2020 operating expense guidance 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 (loss) 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 convertible debt which are in excess of the actual interest expense owing on such convertible debt, as well as non-cash interest related to the Fampyra monetization, 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) goodwill impairment which is a non-cash charge that relates to a reduction in the market capitalization of the Company and is not routine to the operation of the business, (v) gain on extinguishment of debt that pertains to an event that is not routine to the operation of the business, (vi) expenses that pertain to non-routine restructuring events, and (vii) gain on sale of assets that pertains to a non-routine event. The Company believes its non-GAAP net (loss) 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 (loss) income, we have provided 2020 operating expense guidance on a non-GAAP basis, as the guidance excludes restructuring costs and share-based compensation charges. Due to the forward looking nature of this information, the amount of compensation charges 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. Non-GAAP financial measures are not an alternative for financial measures prepared in accordance with GAAP. However, the Company believes that the presentation of this non-GAAP financial measure, when viewed in conjunction with actual GAAP results, provides investors with a more meaningful understanding of our projected operating performance because it excludes (i) expenses that pertain to non-routine restructuring events, and (ii) non-cash charges that are substantially dependent on changes in the market price of our common stock. We believe this non-GAAP financial measure helps indicate underlying trends in the Company’s business and is important in comparing current results with prior period results and understanding expected 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.

About Acorda Therapeutics

Acorda Therapeutics develops therapies to restore function and improve the lives of people with neurological disorders. INBRIJA is approved for intermittent treatment of OFF episodes in adults with Parkinson’s disease treated with carbidopa/levodopa. INBRIJA is not to be used by patients who take or have taken a nonselective monoamine oxidase inhibitor such as phenelzine or tranylcypromine within the last two weeks. 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 Statements

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: we may not be able to successfully market INBRIJA or any other products under development; we may need to raise additional funds to finance our operations, repay outstanding indebtedness or satisfy other obligations, and we may not be able to do so on acceptable terms or at all; risks associated with complex, regulated manufacturing processes for pharmaceuticals, which could affect whether we have sufficient commercial supply of INBRIJA to meet market demand; third party payers (including governmental agencies) may not reimburse for the use of INBRIJA or our other products at acceptable rates or at all and may impose restrictive prior authorization requirements that limit or block prescriptions; competition for INBRIJA, AMPYRA and other products we may develop and market in the future, including increasing competition and accompanying loss of revenues in the U.S. from generic versions of AMPYRA (dalfampridine) following our loss of patent exclusivity; 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; 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 ; 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; 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.

Financial Statements

Acorda Therapeutics, Inc.
Condensed Consolidated Balance Sheet Data
(in thousands)

 

December 31,

 

 

December 31,

 

 

2019

 

 

2018

 

 

(unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

Cash, cash equivalents and short-term investments

$

125,839

 

 

$

445,553

 

Restricted cash - short term

 

12,836

 

 

 

532

 

Trade receivables, net

 

22,083

 

 

 

23,430

 

Other current assets

 

15,134

 

 

 

29,578

 

Inventories, net

 

25,221

 

 

 

29,014

 

Property and equipment, net

 

142,527

 

 

 

60,519

 

Goodwill

 

 

 

 

282,059

 

Intangible assets, net

 

402,329

 

 

 

428,570

 

Restricted cash - long term

 

30,270

 

 

 

255

 

Right of use assets

 

23,450

 

 

 

 

Other assets

 

29

 

 

 

156

 

Total assets

$

799,718

 

 

$

1,299,666

 

 

 

 

 

 

 

 

 

Liabilities and stockholders' equity

 

 

 

 

 

 

 

Accounts payable, accrued expenses and other current liabilities

$

65,335

 

 

$

125,741

 

Current portion of lease liability

 

7,746

 

 

 

 

Current portion of royalty liability

 

10,836

 

 

 

8,985

 

Current portion of acquired contingent consideration

 

1,866

 

 

 

4,914

 

Current portion of loans payable

 

603

 

 

 

616

 

Convertible senior notes

 

192,774

 

 

 

318,670

 

Derivative liability related to conversion option

 

59,409

 

 

 

 

Non-current portion of acquired contingent consideration

 

78,434

 

 

 

163,086

 

Non-current portion of lease liability

 

22,995

 

 

 

 

Non-current portion of royalty liability

 

13,565

 

 

 

21,731

 

Non-current portion of loans payable

 

25,495

 

 

 

24,470

 

Deferred tax liability

 

5,158

 

 

 

7,483

 

Other long-term liabilities

 

4,682

 

 

 

11,987

 

Total stockholders' equity

 

310,820

 

 

 

611,983

 

Total liabilities and stockholders' equity

$

799,718

 

 

$

1,299,666

 

Acorda Therapeutics, Inc.
Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net product revenues

$

47,411

 

 

$

66,351

 

 

$

180,736

 

 

$

459,739

 

Royalty revenues

 

3,085

 

 

 

2,801

 

 

 

11,672

 

 

 

11,694

 

Total revenues

 

50,496

 

 

 

69,152

 

 

 

192,408

 

 

 

471,433

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

8,666

 

 

 

21,476

 

 

 

34,849

 

 

 

97,640

 

Research and development

 

9,023

 

 

 

27,058

 

 

 

60,083

 

 

 

106,383

 

Selling, general and administrative

 

41,223

 

 

 

36,819

 

 

 

192,845

 

 

 

172,254

 

Goodwill impairment

 

 

 

 

 

 

 

277,561

 

 

 

 

Amortization of intangible asset

 

7,691

 

 

 

 

 

 

25,636

 

 

 

1,670

 

Change in fair value of acquired
contingent consideration

 

(30,593

)

 

 

33,100

 

 

 

(86,935

)

 

 

55,000

 

Total operating expenses

 

36,010

 

 

 

118,453

 

 

 

504,039

 

 

 

432,947

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

$

14,486

 

 

$

(49,301

)

 

$

(311,631

)

 

$

38,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on extinguishment of debt

 

55,073

 

 

 

 

 

 

55,073

 

 

 

 

Other income (expense), (net)

 

(4,697

)

 

 

(4,166

)

 

 

(17,689

)

 

 

(18,063

)

Income (loss) before income taxes

 

64,862

 

 

 

(53,467

)

 

 

(274,247

)

 

 

20,423

 

Benefit from income taxes

 

798

 

 

 

63,062

 

 

 

1,282

 

 

 

13,259

 

Net income (loss)

$

65,660

 

 

$

9,595

 

 

$

(272,965

)

 

$

33,682

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per common share - basic

$

1.38

 

 

$

0.20

 

 

$

(5.75

)

 

$

0.72

 

Net income (loss) per common share - diluted

$

1.38

 

 

$

0.20

 

 

$

(5.75

)

 

$

0.71

 

Weighted average common shares - basic

 

47,573

 

 

 

47,515

 

 

 

47,512

 

 

 

47,010

 

Weighted average common shares - diluted

 

47,627

 

 

 

47,606

 

 

 

47,512

 

 

 

47,341

 

Acorda Therapeutics, Inc.
Non-GAAP Net (Loss) Income and Net (Loss) Income per Common Share Reconciliation
(in thousands, except per share amounts)
(unaudited)

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income (loss)

$

65,660

 

 

$

9,595

 

 

$

(272,965

)

 

$

33,682

 

Pro forma adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-cash interest expense (1)

 

3,522

 

 

 

3,905

 

 

 

15,724

 

 

 

15,822

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of acquired
contingent consideration (2)

 

(30,593

)

 

 

33,100

 

 

 

(86,935

)

 

 

55,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restructuring costs (3)

 

4,401

 

 

 

(4

)

 

 

4,401

 

 

 

1,316

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Goodwill impairment charge (4)

 

 

 

 

 

 

 

277,561

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on extinguishment of debt (5)

 

(55,073

)

 

 

 

 

 

(55,073

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of assets (6)

 

 

 

 

(7,837

)

 

 

 

 

 

(7,837

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expenses
included in Cost of Sales

 

118

 

 

 

 

 

 

624

 

 

 

 

Share-based compensation expenses
included in R&D

 

609

 

 

 

1,224

 

 

 

2,812

 

 

 

5,560

 

Share-based compensation expenses
included in SG&A

 

2,029

 

 

 

3,782

 

 

 

10,814

 

 

 

15,692

 

Total share-based compensation expenses

 

2,756

 

 

 

5,006

 

 

 

14,250

 

 

 

21,252

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total pro forma adjustments

 

(74,987

)

 

 

34,170

 

 

 

169,928

 

 

 

85,553

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax effect of reconciling items

above (7)

 

(2,264

)

 

 

22,241

 

 

 

(21,284

)

 

 

15,814

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net (loss) income

$

(7,063

)

 

$

21,524

 

 

$

(81,753

)

 

$

103,421

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income per common share - basic

$

(0.15

)

 

$

0.45

 

 

$

(1.72

)

 

$

2.20

 

Net (loss) income per common share - diluted

$

(0.15

)

 

$

0.45

 

 

$

(1.72

)

 

$

2.18

 

Weighted average common shares - basic

 

47,573

 

 

 

47,515

 

 

 

47,512

 

 

 

47,010

 

Weighted average common shares - diluted

 

47,573

 

 

 

47,606

 

 

 

47,512

 

 

 

47,341

 

(1) Non-cash interest expense related to convertible senior notes, Biotie non-convertible

and R&D loans and Fampyra royalty monetization.

(2) Changes in fair value of acquired contingent consideration related to the Civitas acquisition.

(3) Costs associated with corporate restructuring initiatives.

(4) Impairment of goodwill associated with the Civitas and Biotie acquisitions.

(5) Gain on extinguishment of convertible senior notes due June 2021.

(6) Gain on sale of Qutenza.

(7) Represents the tax effect of the non-GAAP adjustments.

 

Contacts

Tierney Saccavino
(914) 326-5104
tsaccavino@acorda.com

Contacts

Tierney Saccavino
(914) 326-5104
tsaccavino@acorda.com