☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the quarterly period ended September 30, 2016
|
|
OR
|
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from to
|
|
Commission File Number 000-50513
|
Delaware
(State or other jurisdiction of incorporation
or organization)
|
13-3831168
(I.R.S. Employer Identification No.) |
420 Saw Mill River Road, Ardsley, New York
(Address of principal executive offices) |
10502
(Zip Code) |
Large accelerated filer
☒
|
Accelerated filer
☐
|
Non-accelerated filer
☐
(Do not check if a smaller reporting company) |
Smaller Reporting Company
☐
|
Class
|
Outstanding at October 31, 2016
|
|
Common Stock, $0.001 par value
per share |
46,114,306 shares
|
Page
|
||
PART I—FINANCIAL INFORMATION
|
||
Item 1.
|
Financial Statements
|
1
|
Consolidated Balance Sheets as of September 30, 2016 (unaudited) and December 31, 2015
|
1
|
|
Consolidated Statements of Operations (unaudited) for the Three and Nine-month Periods Ended September 30, 2016 and 2015
|
2
|
|
Consolidated Statements of Comprehensive (Loss) Income (unaudited) for the Three and Nine-month Periods Ended September 30, 2016 and 2015
|
3
|
|
Consolidated Statements of Cash Flows (unaudited) for the Nine-month Periods Ended September 30, 2016 and 2015
|
4
|
|
Notes to Consolidated Financial Statements (unaudited)
|
5
|
|
Item 2.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
19
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
35
|
Item 4.
|
Controls and Procedures
|
36
|
PART II—OTHER INFORMATION
|
||
Item 1.
|
Legal Proceedings
|
37
|
Item 1A.
|
Risk Factors
|
39
|
Item 6.
|
Exhibits
|
40
|
(In thousands, except share data)
|
September 30, 2016
|
December 31,
2015 |
||||||
(unaudited)
|
||||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
127,940
|
$
|
153,204
|
||||
Restricted cash
|
—
|
6,032
|
||||||
Short-term investments
|
—
|
200,101
|
||||||
Trade accounts receivable, net of allowances of $957 and $884, as of September 30, 2016 and December 31, 2015, respectively
|
48,575
|
31,466
|
||||||
Prepaid expenses
|
15,639
|
16,079
|
||||||
Finished goods inventory
|
40,935
|
36,476
|
||||||
Other current assets
|
4,863
|
7,959
|
||||||
Total current assets
|
237,952
|
451,317
|
||||||
Property and equipment, net of accumulated depreciation
|
35,777
|
40,204
|
||||||
Goodwill
|
284,029
|
183,636
|
||||||
Deferred tax asset
|
2,951
|
2,128
|
||||||
Intangible assets, net of accumulated amortization
|
749,415
|
430,856
|
||||||
Non-current portion of deferred cost of license revenue
|
2,430
|
2,906
|
||||||
Other assets
|
5,814
|
247
|
||||||
Total assets
|
$
|
1,318,368
|
$
|
1,111,294
|
||||
Liabilities and Stockholders' Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
18,557
|
$
|
14,233
|
||||
Accrued expenses and other current liabilities
|
89,374
|
66,158
|
||||||
Current portion of deferred license revenue
|
9,057
|
9,057
|
||||||
Current portion of convertible notes payable
|
1,134
|
1,144
|
||||||
Total current liabilities
|
118,122
|
90,592
|
||||||
Convertible senior notes (due 2021)
|
297,111
|
290,420
|
||||||
Acquired contingent consideration
|
75,400
|
63,500
|
||||||
Non-current portion of deferred license revenue
|
34,720
|
41,513
|
||||||
Non-current portion of convertible notes payable
|
—
|
1,107
|
||||||
Deferred tax liability
|
91,429
|
12,146
|
||||||
Other non-current liabilities
|
34,820
|
8,991
|
||||||
Commitments and contingencies
|
||||||||
Stockholders' equity:
|
||||||||
Common stock, $0.001 par value. Authorized 80,000,000 shares at September 30, 2016 and December 31, 2015; issued 46,144,900 and 43,440,324 shares, including those held in treasury, as of September 30, 2016 and December 31, 2015, respectively
|
46
|
43
|
||||||
Treasury stock at cost (12,420 shares at September 30, 2016 and December 31, 2015)
|
(329
|
)
|
(329
|
)
|
||||
Additional paid-in capital
|
911,540
|
812,782
|
||||||
Accumulated deficit
|
(240,876
|
)
|
(209,352
|
)
|
||||
Accumulated other comprehensive loss
|
(3,615
|
)
|
(119
|
)
|
||||
Total stockholders' equity.
|
666,766
|
603,025
|
||||||
Total liabilities and stockholders' equity
|
$
|
1,318,368
|
$
|
1,111,294
|
(In thousands, except per share data)
|
Three-month
period ended September 30, 2016 |
Three-month
period ended September 30, 2015 |
Nine-month
period ended September 30, 2016 |
Nine-month
period ended September 30, 2015 |
||||||||||||
Revenues:
|
||||||||||||||||
Net product revenues
|
$
|
128,508
|
$
|
141,330
|
$
|
359,350
|
$
|
342,394
|
||||||||
Royalty revenues
|
4,841
|
4,605
|
12,831
|
12,571
|
||||||||||||
License revenue
|
2,264
|
2,264
|
6,793
|
6,793
|
||||||||||||
Total net revenues
|
135,613
|
148,199
|
378,974
|
361,758
|
||||||||||||
Costs and expenses:
|
||||||||||||||||
Cost of sales
|
27,644
|
24,741
|
77,265
|
65,896
|
||||||||||||
Cost of license revenue
|
159
|
159
|
476
|
476
|
||||||||||||
Research and development
|
54,777
|
43,356
|
149,640
|
105,221
|
||||||||||||
Selling, general and administrative
|
54,805
|
51,056
|
176,388
|
152,645
|
||||||||||||
Changes in fair value of acquired contingent consideration
|
3,700
|
3,200
|
11,900
|
7,400
|
||||||||||||
Total operating expenses
|
141,085
|
122,512
|
415,669
|
331,638
|
||||||||||||
Operating (loss) income
|
(5,472
|
)
|
25,687
|
(36,695
|
)
|
30,120
|
||||||||||
Other (expense) income, (net):
|
||||||||||||||||
Interest and amortization of debt discount expense
|
(4,404
|
)
|
(4,037
|
)
|
(12,161
|
)
|
(12,098
|
)
|
||||||||
Interest income
|
46
|
120
|
309
|
281
|
||||||||||||
Realized loss on foreign currency transactions
|
(179
|
)
|
—
|
(1,674
|
)
|
—
|
||||||||||
Other (expense) income
|
—
|
(59
|
)
|
10,026
|
411
|
|||||||||||
Total other (expense), (net)
|
(4,537
|
)
|
(3,976
|
)
|
(3,500
|
)
|
(11,406
|
)
|
||||||||
(Loss) income before taxes
|
(10,009
|
)
|
21,711
|
(40,195
|
)
|
18,714
|
||||||||||
(Provision for) benefit from income taxes
|
(3,023
|
)
|
(17,770
|
)
|
7,686
|
(16,861
|
)
|
|||||||||
Net (loss) income
|
$
|
(13,032
|
)
|
$
|
3,941
|
$
|
(32,509
|
)
|
$
|
1,853
|
||||||
Net loss attributable to non-controlling interest
|
307
|
—
|
985
|
—
|
||||||||||||
Net (loss) income attributable to Acorda Therapeutics, Inc.
|
$
|
(12,725
|
)
|
$
|
3,941
|
$
|
(31,524
|
)
|
$
|
1,853
|
||||||
Net (loss) income per share attributable to Acorda Therapeutics, Inc.—basic
|
$
|
(0.28
|
)
|
$
|
0.09
|
$
|
(0.70
|
)
|
$
|
0.04
|
||||||
Net (loss) income per share attributable to Acorda Therapeutics, Inc.—diluted
|
$
|
(0.28
|
)
|
$
|
0.09
|
$
|
(0.70
|
)
|
$
|
0.04
|
||||||
Weighted average common shares outstanding used in computing net (loss) income per share attributable to Acorda Therapeutics, Inc.—basic
|
45,378
|
42,174
|
45,178
|
42,097
|
||||||||||||
Weighted average common shares outstanding used in computing net (loss) income per share attributable to Acorda Therapeutics, Inc.—diluted
|
45,378
|
43,432
|
45,178
|
43,434
|
(In thousands)
|
Three-month
period ended September 30, 2016 |
Three-month
period ended September 30, 2015 |
Nine-month
period ended September 30, 2016 |
Nine-month
period ended September 30, 2015 |
||||||||||||
Net (loss) income
|
$
|
(13,032
|
)
|
$
|
3,941
|
$
|
(32,509
|
)
|
$
|
1,853
|
||||||
Other comprehensive (loss) income, net of tax:
|
||||||||||||||||
Foreign currency translation adjustment
|
1,097
|
—
|
(3,615
|
)
|
—
|
|||||||||||
Unrealized gains on available for sale securities
|
—
|
17
|
—
|
31
|
||||||||||||
Reclassification of net losses to net income
|
—
|
—
|
119
|
—
|
||||||||||||
Other comprehensive income (loss), net of tax
|
1,097
|
17
|
(3,496
|
)
|
31
|
|||||||||||
Comprehensive (loss) income.
|
$
|
(11,935
|
)
|
$
|
3,958
|
$
|
(36,005
|
)
|
$
|
1,884
|
||||||
Other comprehensive income (loss) attributable to noncontrolling interest.
|
$
|
17
|
$
|
—
|
$
|
(110
|
)
|
$
|
—
|
(In thousands)
|
Nine-month
period ended September 30, 2016 |
Nine-month
period ended September 30, 2015 |
||||||
Cash flows from operating activities:
|
||||||||
Net (loss) income
|
$
|
(32,509
|
)
|
$
|
1,853
|
|||
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
||||||||
Recognition of deferred product revenue - Zanaflex
|
—
|
(22,186
|
)
|
|||||
Share‑based compensation expense
|
27,392
|
24,748
|
||||||
Amortization of net premiums and discounts on investments
|
467
|
2,372
|
||||||
Amortization of debt discount and debt issuance costs
|
7,158
|
6,383
|
||||||
Amortization of revenue interest issuance cost
|
—
|
15
|
||||||
Depreciation and amortization expense
|
15,775
|
11,153
|
||||||
Change in acquired contingent consideration obligation
|
11,900
|
7,400
|
||||||
Realized gain on foreign currency transaction
|
(10,484
|
)
|
—
|
|||||
Deferred tax (benefit) provision
|
(10,522
|
)
|
16,861
|
|||||
Changes in assets and liabilities:
|
||||||||
(Increase) decrease in accounts receivable
|
(17,018
|
)
|
455
|
|||||
Decrease in prepaid expenses and other current assets
|
5,820
|
1,408
|
||||||
Increase in inventory
|
(4,459
|
)
|
(20,001
|
)
|
||||
Decrease in non-current portion of deferred cost of license revenue
|
476
|
476
|
||||||
Decrease in other assets
|
25
|
25
|
||||||
Increase (decrease) in accounts payable, accrued expenses, other current liabilities
|
9,612
|
(2,158
|
)
|
|||||
Decrease in revenue interest liability interest payable
|
—
|
(124
|
)
|
|||||
Decrease in non-current portion of deferred license revenue
|
(6,793
|
)
|
(6,793
|
)
|
||||
Decrease in deferred product revenue—Zanaflex
|
—
|
(988
|
)
|
|||||
Decrease (increase) in restricted cash
|
6,032
|
(4,743
|
)
|
|||||
Net cash provided by operating activities
|
2,872
|
16,156
|
||||||
Cash flows from investing activities:
|
||||||||
Purchases of property and equipment
|
(4,633
|
)
|
(5,025
|
)
|
||||
Purchases of intangible assets
|
(482
|
)
|
(781
|
)
|
||||
Acquisitions, net of cash received
|
(268,107
|
)
|
—
|
|||||
Purchases of investments
|
(40,214
|
)
|
(359,968
|
)
|
||||
Proceeds from maturities of investments
|
239,966
|
249,500
|
||||||
Net cash used in investing activities
|
(73,470
|
)
|
(116,274
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Proceeds from issuance of common stock and option exercises
|
74,673
|
8,000
|
||||||
Purchase of noncontrolling interest
|
(27,946
|
)
|
—
|
|||||
Debt issuance costs
|
(1,559
|
)
|
—
|
|||||
Repayments of revenue interest liability
|
(41
|
)
|
(215
|
)
|
||||
Net cash provided by financing activities
|
45,127
|
7,785
|
||||||
Effect of exchange rate changes on cash and cash equivalents
|
207
|
—
|
||||||
Net decrease in cash and cash equivalents
|
(25,264
|
)
|
(92,333
|
)
|
||||
Cash and cash equivalents at beginning of period
|
153,204
|
182,170
|
||||||
Cash and cash equivalents at end of period
|
$
|
127,940
|
$
|
89,837
|
||||
Supplemental disclosure:
|
||||||||
Cash paid for interest
|
3,040
|
4,279
|
||||||
Cash paid for taxes
|
3,564
|
2,152
|
||||||
(In thousands)
|
Balance at December 31, 2015
|
|||||||
Revised Reporting
|
As Previously Reported
|
|||||||
Other assets
|
$
|
247
|
$
|
5,296
|
||||
Convertible notes payable – due 2021
|
$
|
(290,420
|
)
|
$
|
(295,469
|
)
|
(In thousands)
|
Preliminary
Allocation as of the
acquisition date
|
Measurement
Period
Adjustments
|
Preliminary Allocation, as adjusted through
September 30, 2016
|
|||||||||
Cash and cash equivalents
|
$
|
73,854
|
$
|
—
|
$
|
73,854
|
||||||
Other current assets
|
2,208
|
—
|
2,208
|
|||||||||
Other long-term assets
|
4,962
|
—
|
4,962
|
|||||||||
Intangible assets (indefinite-lived)
|
260,500
|
—
|
260,500
|
|||||||||
Intangible assets (definite-lived)
|
65,000
|
—
|
65,000
|
|||||||||
Current liabilities
|
(17,547
|
)
|
—
|
(17,547
|
)
|
|||||||
Deferred taxes
|
(89,038
|
)
|
—
|
(89,038
|
)
|
|||||||
Other long-term liabilities
|
(26,715
|
)
|
1,159
|
(25,556
|
)
|
|||||||
Fair value of assets and liabilities acquired
|
273,224
|
1,159
|
274,383
|
|||||||||
Goodwill
|
102,676
|
(1,159
|
)
|
101,517
|
||||||||
Total purchase price
|
375,900
|
—
|
375,900
|
|||||||||
Less: Noncontrolling interests
|
(25,736
|
)
|
—
|
(25,736
|
)
|
|||||||
Purchase consideration on date of acquisition
|
$
|
350,164
|
$
|
—
|
$
|
350,164
|
(In thousands)
|
Stockholders'
Equity
Acorda
|
Non-Controlling
Interest
|
Total Stockholders'
Equity
|
|||||||||
Balance at December 31, 2015
|
$
|
603,025
|
$
|
—
|
$
|
603,025
|
||||||
Net loss
|
(31,524
|
)
|
(985
|
)
|
(32,509
|
)
|
||||||
Other comprehensive loss
|
(3,496
|
)
|
(110
|
)
|
(3,606
|
)
|
||||||
Noncontrolling interest at date of acquisition
|
—
|
25,736
|
25,736
|
|||||||||
Purchase of noncontrolling interest
|
(3,305
|
)
|
(24,641
|
)
|
(27,946
|
)
|
||||||
Private Placement, net of issuance costs
|
72,094
|
—
|
72,094
|
|||||||||
Stock compensation expense and option exercises
|
29,972
|
—
|
29,972
|
|||||||||
Balance at September 30, 2016
|
$
|
666,766
|
$
|
—
|
$
|
666,766
|
Three-month
|
Nine-month
|
|||||||||||||||
period ended
|
period ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(In thousands)
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
Revenues
|
$
|
135,613
|
$
|
149,076
|
$
|
380,032
|
$
|
365,092
|
||||||||
Loss from continuing operations attributable to Acorda
|
$
|
(12,168
|
)
|
$
|
(7,255
|
)
|
$
|
(55,376
|
)
|
$
|
(30,362
|
)
|
September 30, 2016
|
December 31, 2015
|
|||||||||||||||||||||||||||||||
(Dollars In thousands)
|
Estimated
Remaining
Useful Lives
(Years)
|
Cost |
Accumulated
Amortization |
Foreign
Currency
Translation
|
Net
Carrying
Amount
|
Cost
|
Accumulated
Amortization |
Net
Carrying
Amount |
||||||||||||||||||||||||
In-process research & development (1)
|
Indefinite-lived
|
$
|
683,500
|
$
|
-
|
$
|
(307
|
)
|
$
|
683,193
|
$
|
423,000
|
$
|
-
|
$
|
423,000
|
||||||||||||||||
Selincro
|
7
|
65,000
|
(4,229
|
)
|
(780
|
)
|
59,991
|
-
|
-
|
-
|
||||||||||||||||||||||
Ampyra milestones
|
11
|
5,750
|
(2,603
|
)
|
-
|
3,147
|
5,750
|
(2,380
|
)
|
3,370
|
||||||||||||||||||||||
Ampyra CSRO royalty buyout
|
4
|
3,000
|
(2,035
|
)
|
-
|
965
|
3,000
|
(1,817
|
)
|
1,183
|
||||||||||||||||||||||
Website development costs
|
3
|
13,083
|
(11,032
|
)
|
-
|
2,051
|
12,504
|
(9,467
|
)
|
3,037
|
||||||||||||||||||||||
Website development costs – in process
|
n/a
|
68
|
-
|
-
|
68
|
266
|
-
|
266
|
||||||||||||||||||||||||
$
|
770,401
|
$
|
(19,899
|
)
|
$
|
(1,087
|
)
|
$
|
749,415
|
$
|
444,520
|
$
|
(13,664
|
)
|
$
|
430,856
|
(1)
|
Includes the fair values of: CVT-301: $423.0 million; tozadenant: $232.0 million; SYN-120: $24.2 million and BTT-1023: $4.3 million
|
(In thousands)
|
||||
2016
|
$
|
2,857
|
||
2017
|
10,994
|
|||
2018
|
10,298
|
|||
2019
|
9,987
|
|||
2020
|
9,602
|
|||
Thereafter
|
23,19
6
|
|||
$
|
66,93
4
|
In thousands
Balance at December 31, 2015
|
$
|
183,636
|
||
Goodwill associated with the acquisition of Biotie Therapies
|
102,676
|
|||
Decrease to goodwill for measurement period adjustment
|
(1,159
|
)
|
||
Foreign currency translation adjustment
|
(1,124
|
)
|
||
Balance at September 30, 2016
|
$
|
284,029
|
For the three-month
|
For the nine-month
|
|||||||||||||||
period ended September 30,
|
period ended September 30,
|
|||||||||||||||
(In millions)
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
Research and development
|
$
|
2.9
|
$
|
2.2
|
$
|
7.7
|
$
|
6.2
|
||||||||
Selling, general and administrative
|
7.1
|
6.7
|
19.7
|
18.5
|
||||||||||||
Total
|
$
|
10.0
|
$
|
8.9
|
$
|
27.4
|
$
|
24.7
|
Number of Shares
(In thousands)
|
Weighted Average
Exercise Price |
Weighted Average
Remaining Contractual Term |
Intrinsic Value
(In thousands)
|
|||||||||||||
Balance at January 1, 2016
|
8,223
|
$
|
30.97
|
|||||||||||||
Granted
|
1,717
|
31.91
|
||||||||||||||
Cancelled
|
(526
|
)
|
34.22
|
|||||||||||||
Exercised
|
(141
|
)
|
18.33
|
|||||||||||||
Balance at September 30, 2016
|
9,273
|
$
|
31.15
|
6.4
|
$
|
816
|
||||||||||
Vested and expected to vest at September 30, 2016
|
9,175
|
$
|
31.13
|
6.4
|
$
|
816
|
||||||||||
Vested and exercisable at September 30, 2016
|
5,877
|
$
|
29.60
|
5.3
|
$
|
816
|
(In thousands)
Restricted Stock
|
Number of Shares
|
|||
Nonvested at January 1, 2016
|
441
|
|||
Granted
|
659
|
|||
Vested
|
(19
|
)
|
||
Forfeited
|
(
219
|
)
|
||
Nonvested at September 30, 2016
|
862
|
(In thousands, except per share data)
|
Three-month
period ended September 30, 2016 |
Three-month
period ended September 30, 2015 |
Nine-month
period ended September 30, 2016 |
Nine-month
period ended September 30, 2015 |
||||||||||||
Basic and diluted
|
||||||||||||||||
Net (loss) income
|
$
|
(12,725
|
)
|
$
|
3,941
|
$
|
(31,524
|
)
|
$
|
1,853
|
||||||
Weighted average common shares outstanding used in computing net (loss) income per share—basic
|
45,378
|
42,174
|
45,178
|
42,097
|
||||||||||||
Plus: net effect of dilutive stock options and restricted common shares
|
—
|
1,258
|
—
|
1,337
|
||||||||||||
Weighted average common shares outstanding used in computing net (loss) income per share—diluted
|
45,378
|
43,432
|
45,178
|
43,434
|
||||||||||||
Net (loss) income per share—basic
|
$
|
(0.28
|
)
|
$
|
0.09
|
$
|
(0.70
|
)
|
$
|
0.04
|
||||||
Net (loss) income per share—diluted
|
$
|
(0.28
|
)
|
$
|
0.09
|
$
|
(0.70
|
)
|
$
|
0.04
|
(In thousands)
|
Three-month
period ended
September 30, 2016
|
Three-month
period ended
September 30, 2015
|
Nine-month
period ended
September 30, 2016
|
Nine-month
period ended
September 30, 2015
|
||||||||||||
Denominator
|
||||||||||||||||
Stock options and restricted common shares
|
8,278
|
4,630
|
7,821
|
4,517
|
||||||||||||
Convertible note – Saints Capital
|
10
|
19
|
10
|
19
|
(In thousands)
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
September 30, 2016
|
||||||||||||
Assets Carried at Fair Value:
|
||||||||||||
Cash equivalents
|
$
|
25,519
|
$
|
—
|
$
|
—
|
||||||
Liabilities Carried at Fair Value:
|
||||||||||||
Acquired contingent consideration
|
—
|
—
|
75,400
|
|||||||||
December 31, 2015
|
||||||||||||
Assets Carried at Fair Value:
|
||||||||||||
Cash equivalents
|
$
|
70,504
|
$
|
13,009
|
$
|
—
|
||||||
Short-term investments
|
—
|
200,101
|
—
|
|||||||||
Liabilities Carried at Fair Value:
|
||||||||||||
Acquired contingent consideration
|
—
|
—
|
63,500
|
(In thousands)
|
Three-month
period ended September 30, 2016 |
Three-month
period ended September 30, 2015 |
Nine-month
period ended September 30, 2016 |
Nine-month
period ended September 30, 2015 |
||||||||||||
Acquired contingent consideration:
|
||||||||||||||||
Balance, beginning of period
|
$
|
71,700
|
$
|
56,800
|
$
|
63,500
|
$
|
52,600
|
||||||||
Fair value change to contingent consideration (unrealized) included in the statement of operations
|
3,700
|
3,200
|
11,900
|
7,400
|
||||||||||||
Balance, end of period
|
$
|
75,400
|
$
|
60,000
|
$
|
75,400
|
$
|
60,000
|
(In thousands)
|
Amortized
Cost |
Gross
unrealized gains |
Gross
unrealized losses |
Estimated
fair value |
||||||||||||
September 30, 2016
|
||||||||||||||||
U.S. Treasury bonds
|
$
|
—
|
$
|
—
|
$
|
(—
|
)
|
$
|
—
|
|||||||
December 31, 2015
|
||||||||||||||||
U.S. Treasury bonds
|
200,244
|
—
|
(143
|
)
|
200,101
|
(In thousands)
|
Net Unrealized Gains (Losses) on Marketable Securities
|
|||
Balance at December 31, 2015
|
$
|
(119
|
)
|
|
Other comprehensive loss before reclassifications:
|
—
|
|||
Amounts reclassified from accumulated other
comprehensive loss
|
119
|
|||
Net current period other comprehensive income
|
119
|
|||
Balance at September 30, 2016
|
$
|
—
|
·
|
U.S. accounts receivable, inventory and manufacturing equipment;
|
·
|
Equity interests in the Company's U.S. subsidiaries (other than its U.S. subsidiary of Biotie Therapies Oyj) and up to 65% of the voting equity interests of its directly owned foreign subsidiaries; and
|
·
|
Substantially all other tangible and intangible assets, including equipment, contract rights and intellectual property (other than intellectual property related to Ampyra).
|
Payments due by period (1)(9)
|
||||||||||||||||
(In thousands)
|
Total
|
Less than
1 year |
1-3 years
|
4-5 years
|
||||||||||||
Convertible Senior Notes (2)
|
$
|
374,575
|
$
|
6,038
|
$
|
12,075
|
$
|
356,462
|
||||||||
Convertible note payable (3)
|
1,144
|
1,144
|
—
|
—
|
||||||||||||
Capital loans (4) (6)
|
20,089
|
—
|
—
|
—
|
||||||||||||
Research and development loans (5) (6)
|
3,002
|
600
|
1,201
|
1,201
|
||||||||||||
Operating leases (7)
|
31,659
|
6,255
|
12,258
|
13,146
|
||||||||||||
Inventory purchase commitments (8)
|
34,980
|
34,980
|
—
|
—
|
||||||||||||
Total
|
$
|
465,449
|
$
|
49,017
|
$
|
25,534
|
$
|
370,809
|
(1) |
Excludes a liability for uncertain tax positions totaling $6.3 million. This liability has been excluded because the Company cannot currently make a reliable estimate of the period in which the liability will be payable, if ever.
|
(2) |
Represents the future payments of principal and interest to be made on the Convertible Senior Notes issued in June 2014 and due in 2021.
|
(3) |
Represents the remaining annual payment of principal and interest to be made on the convertible note payable to Saints Capital.
|
(4) |
Represents payments for the convertible and non-convertible capital loans. The convertible capital loan and the non-convertible capital loans have a stated maturity of less than one year. However, the repayment of these loans and payment of accrued interest thereon are governed by a restrictive condition, according to which the loan principal must only be repaid if Biotie's consolidated restricted equity is fully covered. Accrued interest must only be paid if Biotie, including its subsidiaries, has sufficient funds for profit distribution as of the most recently ended fiscal year. Interest accrues in the interim.
|
(5) |
Represents the future principal payments on the R&D loans acquired from Biotie.
|
(6) |
The amounts do not include interest costs at the loans' applicable interest rates.
|
(7) |
Represents payments for the operating leases of the Company's Ardsley, NY headquarters, the Company's manufacturing facility in Chelsea, MA, Biotie's headquarters at Turku, Finland, and Biotie's clinical operations in South San Francisco, CA.
|
(8) |
Represents Ampyra, Zanaflex, and Qutenza inventory commitments. The Ampyra inventory commitment is an estimate as the price paid for Ampyra inventory is based on a percentage of the net product sales during the quarter Alkermes ships inventory to us. Under our supply agreement with Alkermes, we provide Alkermes with monthly written 18-month forecasts, and with annual written five-year forecasts for our supply requirements of Ampyra and two-year forecasts for our supply requirements of Zanaflex Capsules. In each of the five months for Zanaflex and three months for Ampyra following the submission of our written 18-month forecast we are obligated to purchase the quantity specified in the forecast, even if our actual requirements are greater or less. We have agreed to purchase at least 75% of our annual requirements of Ampyra from Alkermes, unless Alkermes is unable or
|
(9) |
Pursuant to the UCB Termination and Transition Agreement, Biotie is required to pay up to $4.3 million (€ 3.9 million) to UCB. The amount that will be paid will be determined based on a percentage of future consideration Biotie will receive from tozadenant. The liability is excluded as the Company cannot currently estimate the period in which the liability will be payable, if ever.
|
(In thousands)
|
||||
2016
|
$
|
1,564
|
||
2017
|
6,252
|
|||
2018
|
6,347
|
|||
2019
|
5,821
|
|||
2020
|
5,966
|
|||
Later years
|
18,192
|
|||
$
|
44,142
|
●
|
The first is U.S. Patent No. 8,007,826, with claims relating to methods to improve walking in patients with MS by administering 10 mg of sustained release 4-aminopyridine (dalfampridine) twice daily. Based on the final patent term adjustment calculation of the United States Patent and Trademark Office, or USPTO, this patent will extend into 2027.
|
●
|
The second is U.S. Patent No. 5,540,938, the claims of which relate to methods for treating a neurological disease, such as MS, and cover the use of a sustained release dalfampridine formulation, such as AMPYRA (dalfampridine) Extended Release Tablets, 10 mg for improving walking in people with MS. In April 2013, this patent received a five year patent term extension under the patent restoration provisions of the Hatch-Waxman Act. With a five year patent term extension, this patent will expire in 2018.
We have an exclusive license to this patent from Alkermes (originally with Elan, but transferred to Alkermes as part of its acquisition of Elan's Drug Technologies business).
|
●
|
The third is U.S. Patent No. 8,354,437, which includes claims relating to methods to improve walking, increase walking speed, and treat walking disability in patients with MS by administering 10 mg of sustained release 4-aminopyridine (dalfampridine) twice daily. This patent is set to expire in 2026.
|
●
|
The fourth is U.S. Patent No. 8,440,703, which includes claims directed to methods of improving lower extremity function and walking and increasing walking speed in patients with MS by administering less than 15 mg of sustained release 4-aminopyridine (dalfampridine) twice daily. This patent is set to expire in 2025.
|
●
|
The fifth is U.S. Patent No. 8,663,685 with claims relating to methods to improve walking in patients with MS by administering 10 mg of sustained release 4-aminopyridine (dalfampridine) twice daily. Absent patent term adjustment, the patent is set to expire in 2025.
|
·
|
We expect 2016 net revenue from the sale of Ampyra to range from $475 million to $485 million.
|
·
|
Research and development (R&D) expenses in 2016 are expected to range from $195 million to $205 million, excluding share-based compensation charges.
|
·
|
Selling, general and administrative (SG&A) expenses in 2016 are expected to range from $195 million to $205 million, excluding share-based compensation charges and transaction expenses related to the Biotie acquisition. This SG&A guidance reflects the addition of the Biotie operations, offset by reductions in current and projected SG&A expenses. We set a high priority on managing selling, general and administrative expenses in 2016.
|
·
|
We expect to be approximately cash flow neutral for the second half of 2016.
|
·
|
Continue progressing our Phase 3 clinical study of CVT-301 for the treatment of OFF periods in Parkinson's disease. The last patient out of the efficacy trial is expected by the end of 2016 and data is expected by the first quarter of 2017. We had a pre-NDA (New Drug Application) meeting with the FDA during the third quarter of 2016 and have received the FDA's minutes of that meeting. Based on the expected timing of the last patient out of the Phase 3 efficacy trial by the end of 2016, as well as the minutes confirming our conversation with the FDA, we expect to file the NDA submission in the second quarter of 2017.
We also expect to announce data from our 12-month safety study, an open-label study evaluating CVT-301 against non-interventional standard of care, in the first quarter of 2017.
|
·
|
Continue progressing Biotie's Phase 3 clinical trial of tozadenant, an oral adenosine A2a receptor antagonist being developed as an adjunctive treatment to levodopa in Parkinson's disease patients to reduce OFF time. The clinical trial is currently enrolling and Biotie expects that the efficacy phase of this trial will be clinically complete by the end of 2017, with the safety phase continuing thereafter.
|
·
|
Proceed with an unblinded analysis of clinical trial data from our Phase 3 clinical trial assessing the use of a twice-daily (BID) formulation of dalfampridine as a treatment for post-stroke walking difficulties (PSWD) after experiencing an ischemic stroke. Data are expected in the fourth quarter of 2016. Data from the Phase 1 multi-dose pharmacokinetic testing for once-daily (QD) dalfampridine are also expected in the fourth quarter of 2016. If the
|
|
|
●
|
Based on initial study analyses of a completed Phase 1 safety/tolerability and pharmacokinetic clinical trial of CVT-427, we are planning to advance the development program and are designing protocols for the next studies. We initiated a special population study to evaluate safe inhalation in patients with asthma and in smokers in September, 2016 and, upon successful completion of the study, we plan to advance the program into Phase 2 in the first half of 2017.
|
●
|
In June 2015 we announced that we had stopped enrollment in our second clinical trial of cimaglermin based on the occurrence of a case of hepatotoxicity (liver injury) (elevated ALT, AST and bilirubin), based on blood test results. We also received a notification of clinical hold from the FDA following submission of this information, and the trial remains subject to the clinical hold. The 22 patients who were dosed in the trial have completed the pre-planned one year of follow up. Outside of the hepatotoxicity case, the safety profile from this trial was consistent with our first Phase 1 trial, but efficacy data was inconclusive which we believe was in part due to the very small number of patients in the trial. We have ongoing analyses and non-clinical studies to further define the nature of the bilirubin signal. We have met with the FDA to present analysis of the data from the cimaglermin studies, as well as data from non-clinical studies, as part of our request that the program be removed from clinical hold.
|
·
|
We are currently enrolling
a Phase 1 trial of rHIgM22 using one of two doses of rHIgM22 or placebo in people with MS who are experiencing an acute relapse. In addition to assessing safety and tolerability during an acute relapse, the study includes exploratory efficacy measures such as a timed walk, magnetization transfer ratio imaging of lesion myelination in the brain and various biomarkers. We expect to complete the trial in the second half of 2017.
|
(In thousands)
|
September 30, 2016
|
|||
Liability component:
|
||||
Principal
|
$
|
345,000
|
||
Less: debt discount and debt issuance costs, net
|
(47,889
|
)
|
||
Net carrying amount
|
$
|
297,111
|
||
Equity component
|
$
|
61,195
|
·
|
U.S. accounts receivable, inventory and manufacturing equipment;
|
·
|
Equity interests in the Company's U.S. subsidiaries (other than its U.S. subsidiary of Biotie Therapies Oyj) and up to 65% of the voting equity interests of its directly owned foreign subsidiaries; and
|
·
|
Substantially all other tangible and intangible assets, including equipment, contract rights and intellectual property (other than intellectual property related to Ampyra).
|
Exhibit No
.
|
Description
|
|
10.1*
|
Form of Performance Unit Agreement for awards under the Acorda Therapeutics, Inc. 2015 Omnibus Incentive Compensation Plan.
|
|
10.2*
|
Employment Agreement dated as of July 1, 2016, by and between the Registrant and Burkhard Blank, M.D.
|
|
31.1
|
Certification by the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
31.2
|
Certification by the Principal Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
32.1
|
Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification by the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS**
|
XBRL Instance Document.
|
|
101.SCH**
|
XBRL Taxonomy Extension Schema Document.
|
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
* |
Indicates management contract or compensatory plan or arrangement.
|
** |
In accordance with Regulation S-T, the XBRL-related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall be deemed to be "furnished" and not "filed."
|
Acorda Therapeutics, Inc.
|
||
By:
|
/s/
Ron Cohen
|
|
Date: November 7, 2016
|
Ron Cohen, M.D.
President, Chief Executive Officer and Director |
By:
|
/s/
David Lawrence
|
|
Date: November 7, 2016
|
David Lawrence
Chief, Business Operations and Principal Accounting Officer |
Exhibit No.
|
Description
|
|
10.1*
|
Form of Performance Unit Agreement for awards under the Acorda Therapeutics, Inc. 2015 Omnibus Incentive Compensation Plan.
|
|
10.2*
|
Employment Agreement dated as of July 1, 2016, by and between the Registrant and Burkhard Blank, M.D.
|
|
31.1
|
Certification by the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
31.2
|
Certification by the Principal Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
|
|
32.1
|
Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification by the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS**
|
XBRL Instance Document.
|
|
101.SCH**
|
XBRL Taxonomy Extension Schema Document.
|
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
* |
Indicates management contract or compensatory plan or arrangement.
|
2.
|
Treatment During Performance Period.
|
1. |
Employment.
|
2. |
Base Salary.
|
3. |
Annual Bonus.
|
4. |
Benefits; Perquisites; Reimbursement of Expenses.
|
5. |
Stock Options, Stock Appreciation Rights and Restricted Stock Awards
.
|
6. |
Termination.
|
7. |
Confidentiality/Noncompetition.
|
8. |
Term
.
|
9. |
Miscellaneous Provisions.
|
1. |
I have reviewed this quarterly report on Form 10-Q of Acorda Therapeutics, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5. |
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/
Ron Cohen
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Ron Cohen
Chief Executive Officer
(Principal Executive Officer)
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1. |
I have reviewed this quarterly report on Form 10-Q of Acorda Therapeutics, Inc.;
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2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4. |
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c) |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d) |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5. |
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/
David Lawrence
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David Lawrence
Chief, Business Operations and Principal Accounting Officer
(Principal Financial Officer)
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(1) |
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
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(2) |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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(1) |
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
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(2) |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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