HAWTHORNE, N.Y.--(BUSINESS WIRE)--March 31, 2006--Acorda
Therapeutics (Nasdaq:ACOR) today announced its financial results for
the fourth quarter and full year ended December 31, 2005.
"The launch of Zanaflex Capsules in April 2005 transformed Acorda
into a fully-integrated biotechnology company. In 2005, we also
received an SPA from the FDA for our Fampridine-SR Phase 3 study in
MS, which we initiated. We now have a commercial sales and marketing
operation, complementing our strong pipeline and clinical and
pre-clinical capabilities," stated Ron Cohen, M.D., President and CEO.
"These accomplishments provided the foundation for the successful
completion of our initial public offering in February 2006."
Financial Results
For the quarter ended December 31, 2005, gross sales of Zanaflex
Capsules were $1.4 million and gross sales of Zanaflex tablets were
$1.3 million providing combined gross sales of $2.7 million, compared
to $0 for the same quarter in 2004. For the year ended December 31,
2005, gross sales of Zanaflex Capsules were $2.5 million and gross
sales of Zanaflex tablets were $3.4 million providing combined gross
sales of $5.9 million, compared to $0 for the prior year. Gross sales
are recognized using a deferred revenue recognition model, meaning
Zanaflex product shipments to wholesalers are recorded as deferred
revenue and only recognized as revenue when end-user prescriptions of
Zanaflex Capsules and tablets are reported. Zanaflex Capsule shipments
to wholesalers for the quarter ended December 31, 2005 were $1.7
million and Zanaflex tablet shipments were $2.3 million providing
total shipments of $4.0 million, compared to $3.9 million in Zanaflex
tablet shipments for the same quarter in 2004. For the year ended
December 31, 2005, Zanaflex Capsule shipments were $7.8 million and
Zanaflex tablet shipments were $10.3 million providing total shipments
to wholesalers of $18.1 million, compared to $6.7 million in Zanaflex
tablet shipments for the prior year. Deferred product revenue as of
December 31, 2005 was $16.7 million compared to $6.7 million as of
December 31, 2004.
For the quarter ended December 31, 2005, cost of sales increased
by $2.3 million over the quarter ended December 31, 2004. This
increase was primarily due to a $1.8 million reserve for excess
inventory with expiration dating of 24 months at the time of purchase
that, if not sold, will be written off in 2006.
For the year ended December 2005, cost of sales increased by $4.2
million compared to the year ended 2004. This increase was primarily
due to an increase in royalty fees, inventory costs and an increase
based on the reserve for the short dated product.
Net loss for the fourth quarter ended December 31, 2005 was $15.8
million or $75.59 per share, compared to a net loss of $18.5 million
or $93.73 per share for the quarter ended December 31, 2004. For the
year ended December 31, 2005, net loss was $60.4 million or $295.97
per share, compared to a net loss of $69.5 million or $351.76 per
share for the year ended 2004. For the periods reported, our earnings
per share calculations were based on the Company's pre-IPO outstanding
common shares.
As of December 31, 2005, the Company held cash, cash equivalents
and short term investments of $13.8 million.
For the quarter ended December 31, 2005, total operating expenses
increased by $1.3 million over the quarter ended December 31, 2004.
This increase was primarily attributable to increased expenses related
to the marketing, distribution and sales administration expenses for
sales of Zanaflex Capsules.
For the year ended December 31, 2005, operating expenses decreased
by $5.5 million compared to the year ended December 31, 2004. This
decrease was primarily due to the completion of two Phase 3 clinical
trials of Fampridine-SR in spinal cord injury (SCI), and one Phase 2
clinical trial of Fampridine-SR in multiple sclerosis (MS) during the
first quarter of 2004. The Company also realized a reduction in its
non-cash share based compensation cost and salary expense during 2005
due to the Company's repricing of certain of its stock options during
2004 that resulted in a charge to earnings in 2004. The Company also
reduced its staff in early 2005 resulting in a lower salary expense,
which was partially offset by increases in marketing, distribution and
sales administration expenses related to the launch of Zanaflex
Capsules, distribution expenses for Zanaflex tablets and an increase
in salaries and benefits related to the Company's Zanaflex Capsules
specialty sales force.
Zanaflex Capsules Highlights
-- In April 2005, Acorda launched its first marketed product,
Zanaflex Capsules. Zanaflex Capsules is a new formulation of
tizanidine, one of the two leading treatments approved for the
management of spasticity. The Company initially launched the
product with a 14-person, in-house specialist sales force.
-- On March 3, 2006, the Company reported the expansion of its
in-house sales force from 14 to 32 sales professionals.
-- In March 2006, the Company initiated a primary care pilot
program with Innovex, using 6 part-time representatives making
exclusive calls for Zanaflex Capsules. Also on March 30, 2006,
the Company gave notice of termination to Cardinal Health of
its syndicated sales force agreement.
Fampridine-SR Highlights
-- In May 2005, the Company announced that it had received a
Special Protocol Assessment (SPA) on the protocol design of
its Phase 3 trial of Fampridine-SR. The FDA agreed that the
trial, if successful, could qualify as one of the pivotal
efficacy studies required for drug approval.
-- In June 2005, Acorda reported the initiation of the Phase 3
trial. The study is evaluating the safety and efficacy of
Fampridine-SR in improving walking ability in people with MS.
-- On March 3, 2006, the Company reported that it had completed
enrollment in its Phase 3 clinical trial of Fampridine-SR. The
Company expects to report data from this trial in the third
quarter of 2006.
Corporate Highlights
-- In December 2005 we entered an agreement with Paul Royalty
Fund to receive $15 million in funding in exchange for a
portion of net revenues (as defined in the agreement, which is
different from our net revenues determined in accordance with
GAAP) on Zanaflex Capsules, Zanaflex tablets, and other
formulations. The agreement allows for additional funding
based on the achievement of milestones.
-- On February 10, 2006 the Company announced the completion of
its Initial Public Offering of its common stock, raising net
proceeds of $31.8 million after deducting the underwriting
discount and offering expenses. This amount included the sale
of shares from the underwriters' over allotment option.
-- On March 10, 2006, the Company announced that Lorin J.
Randall, Senior Vice President and Chief Financial Officer for
Eximias Pharmaceutical Corporation, joined the Acorda Board of
Directors and will serve as the Chairman of Acorda's Audit
Committee.
Conference Call and Webcast
Ron Cohen, President and Chief Executive Officer, David Lawrence,
Chief Financial Officer, and Mary Fisher, Chief Operating Officer will
host a conference call today at 8:30 am ET to review the Company's
fourth quarter and year-end 2005 results. To access the call, please
dial 866-383-8003 (domestic) or 617-597-5330 (international) five
minutes prior to the start time, and provide the access code 81810986.
A replay of the call will be available from 10:30 a.m. Eastern Time on
March 31 until 11:59 p.m. Eastern Time on April 29, 2006. To access
the replay, please dial 888-286-8010 (domestic) or 617-801-6888
(international), and provide the access code 98316449. A live audio
webcast of the call can also be accessed from the Company's website,
at http://www.acorda.com.
Forward Looking Statements
This press release includes forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. 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 Acorda Therapeutics' ability to successfully
market and sell Zanaflex Capsules , the risk of unfavorable results
from the Phase 3 clinical trial of Fampridine SR, delays in obtaining
or failure to obtain FDA approval of Fampridine SR, competition, the
ability to obtain additional financing to support Acorda Therapeutics'
operations, unfavorable results from its preclinical programs, and
failure to protect its intellectual property or to defend against the
intellectual property claims of others. These and other risks are
described in greater detail in Acorda Therapeutics' filings with the
Securities and Exchange Commission. Acorda Therapeutics may not
actually achieve the goals or plans described in its forward-looking
statements, and investors should not place undue reliance on these
statements. Acorda Therapeutics disclaims any intent or obligation to
update any forward-looking statements as a result of developments
occurring after the date of this press release.
About Acorda Therapeutics
Acorda Therapeutics is a biotechnology company developing
therapies for SCI, MS and related nervous system disorders. The
Company's marketed products include Zanaflex Capsules(TM) (tizanidine
hydrochloride), a short-acting drug indicated for the management of
spasticity. For full prescribing information, please go to
www.zanaflexcapsules.com. Acorda's lead clinical-stage product is
Fampridine-SR, which is in a Phase 3 clinical trial for MS. The
Company's pipeline includes a number of products in development for
the treatment, regeneration and repair of the spinal cord and brain.
Financial Statements
Acorda Therapeutics, Inc
Consolidated Statements of Operations
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005 2004
--------- --------- --------- ---------
Gross sales - Zanaflex $ 2,684 $ - $ 5,923 $ -
Less: discounts and
allowances (122) (4,272) (1,114) (4,417)
--------- --------- --------- ---------
Net sales 2,562 (4,272) 4,809 (4,417)
Grant revenue 152 35 336 479
--------- --------- --------- ---------
Total net revenue 2,714 (4,237) 5,145 (3,938)
--------- --------- --------- ---------
Less: cost of sales (2,858) (523) (5,132) (885)
--------- --------- --------- ---------
Gross profit (144) (4,760) 13 (4,823)
Operating expenses:
Research and development 3,237 3,378 12,890 21,999
Sales and marketing 3,441 1,869 13,098 4,662
General and administrative 2,096 2,250 8,435 13,283
--------- --------- --------- ---------
Total operating expenses 8,774 7,497 34,423 39,944
--------- --------- --------- ---------
Operating loss (8,918) (12,257) (34,410) (44,767)
--------- --------- --------- ---------
Other income (expense):
Interest and amortization
of debt discount expense (702) (88) (1,526) (385)
Interest income 54 80 402 409
Other income - - 1 2
--------- --------- --------- ---------
(648) (8) (1,123) 26
Cumulative effect of change
in accounting principle - - 3 -
--------- --------- --------- ---------
Net loss (9,566) (12,265) (35,530) (44,741)
Beneficial conversion
feature, accretion of
issuance costs, preferred
dividends, and fair value
of warrants issued to
convertible preferred
stockholders (6,212) (6,250) (24,849) (24,746)
Net loss allocable to --------- --------- --------- ---------
common shareholders $ (15,778) $ (18,515) $ (60,379) $ (69,487)
========= ========= ========= =========
Net loss per share
allocable to common
stockholders - basic and
diluted $ (75.59) $ (93.73) $ (295.27) $ (351.76)
Weighted average common
shares outstanding used in
computing net loss per
share allocable to common
stockholders -
basic and diluted 208,734 197,541 204,485 197,541
Acorda Therapeutics, Inc
Consolidated Balance Sheet Data
(in thousands)
(Unaudited)
2005 2004
--------- ---------
Assets
Cash and cash equivalents $ 11,761 $ 11,729
Short-term investments 2,001 9,397
Finished goods inventory held by
the Company, net 5,587 192
Property and equipment, net 1,707 2,547
Intangible assets, net 5,952 3,386
Total assets $ 33,912 $ 30,982
Liabilities and stockholders' equity (deficit)
Accounts payable, accrued expenses
and other liabilities $ 14,060 $ 4,820
Deferred product revenue 16,736 6,668
Total current liabilities 35,858 15,872
Long term liabilities 23,377 9,317
Stockholders deficit (116,536) (60,571)
Total Liabilities and Stockholders deficit $ 33,912 $ 30,982
CONTACT: Acorda Therapeutics
Erica Wishner, 914-347-4300 ext. 162
ewishner@acorda.com
SOURCE: Acorda Therapeutics
