10-Q 1 acor-20230930.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

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 001-31938

 

ACORDA THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

13-3831168

(State or other jurisdiction of incorporation

or organization)

 

(I.R.S. Employer

Identification No.)

 

2 Blue Hill Plaza, 3rd Floor, Pearl River, New York

 

10965

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (914) 347-4300

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol

 

Name of each exchange on which registered

Common Stock $0.001 par value per share

ACOR

 

Nasdaq Global Select Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class

 

Outstanding at November 9, 2023

Common Stock, $0.001 par value per share

 

1,242,098 shares

 

 


ACORDA THERAPEUTICS, INC.

TABLE OF CONTENTS

 

 

Page

PART I—FINANCIAL INFORMATION

 

Item 1.

Financial Statements

1

 

Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022

1

 

Consolidated Statements of Operations (unaudited) for the Three- and Nine-month Periods Ended September 30, 2023 and 2022

2

 

Consolidated Statements of Comprehensive Income (Loss) (unaudited) for the Three- and Nine-month Periods Ended September 30, 2023 and 2022

3

 

Consolidated Statements of Changes in Stockholders’ Equity (unaudited) for the Three- and Nine-month Periods Ended September 30, 2023 and 2022

4

 

Consolidated Statements of Cash Flows (unaudited) for the Nine-month Periods Ended September 30, 2023 and 2022

6

 

Notes to Consolidated Financial Statements (unaudited)

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

22

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

34

Item 4.

Controls and Procedures

35

PART II—OTHER INFORMATION

 

Item 1.

Legal Proceedings

36

Item 1A.

Risk Factors

36

Item 5.

Other Information

36

Item 6.

Exhibits

37

Signatures

 

38

 

This Quarterly Report on Form 10-Q contains forward‑looking statements relating to future events and our future performance within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Readers are cautioned that such statements involve risks and uncertainties, including: We may not be able to successfully market Inbrija, Ampyra, or any other products that we may develop; our ability to attract and retain key management and other personnel, or maintain access to expert advisors; our ability to raise additional funds to finance our operations, repay outstanding indebtedness or satisfy other obligations, and our ability to control our costs or reduce planned expenditures and take other actions which are necessary for us to continue as a going concern; risks related to the successful implementation of our business plan, including the accuracy of our key assumptions; risks related to our corporate restructurings, including our ability to outsource certain operations, realize expected cost savings and maintain the workforce needed for continued operations; risks associated with complex, regulated manufacturing processes for pharmaceuticals, which could affect whether we have sufficient commercial supply of Inbrija to meet market demand; our reliance on third-party manufacturers for the production of commercial supplies of Inbrija and Ampyra; third-party payers (including governmental agencies) may not reimburse for the use of Inbrija at acceptable rates or at all and may impose restrictive prior authorization requirements that limit or block prescriptions; reliance on collaborators and distributors to commercialize Inbrija and Ampyra outside the U.S.; our ability to satisfy our obligations to distributors and collaboration partners outside the U.S. relating to commercialization and supply of Inbrija and Ampyra; competition for Inbrija and Ampyra, including increasing competition and accompanying loss of revenues in the U.S. from generic versions of Ampyra following our loss of patent exclusivity; the ability to realize the benefits anticipated from acquisitions because, among other reasons, 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 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 forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management’s beliefs and assumptions. All statements, other than statements of historical facts, included in this report regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results or events could differ materially from the plans, intentions and expectations disclosed

 


in the forward-looking statements we make, and investors should not place undue reliance on these statements. In addition to the risks and uncertainties described above, we have included important factors in the cautionary statements included in this report and in our Annual Report on Form 10-K for the year ended December 31, 2022, particularly in the “Risk Factors” section (as updated by the disclosures in our subsequent quarterly reports, including this report), that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments that we may make. Forward-looking statements in this report 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 report except as may be required by law.

We and our subsidiaries own several registered trademarks in the U.S. and in other countries. These registered trademarks include, in the U.S., the marks “Acorda Therapeutics”, our stylized Acorda Therapeutics logo, “Inbrija”, “Ampyra”, and “ARCUS.” Also, our marks “Fampyra” and “Inbrija” are registered marks in the European Community Trademark Office and we have registrations or pending applications for these marks in other jurisdictions. Our trademark portfolio also includes several registered trademarks and pending trademark applications in the U.S. and worldwide for potential product names or for disease awareness activities. Third party trademarks, trade names, and service marks used in this report are the property of their respective owners.

 


 

PART I

Item 1. Financial Statements

ACORDA THERAPEUTICS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

 

 

 

September 30, 2023

 

 

December 31, 2022

 

 

 

(unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

32,468

 

 

$

37,536

 

Restricted cash

 

 

861

 

 

 

6,884

 

Trade accounts receivable, net of allowances of $791 and $842, as of
   September 30, 2023 and December 31, 2022, respectively

 

 

11,977

 

 

 

13,866

 

Prepaid expenses

 

 

5,042

 

 

 

4,312

 

Inventory, net

 

 

17,942

 

 

 

12,752

 

Other current assets

 

 

5,438

 

 

 

6,765

 

Total current assets

 

 

73,728

 

 

 

82,115

 

Property and equipment, net of accumulated depreciation

 

 

2,210

 

 

 

2,603

 

Intangible assets, net of accumulated amortization

 

 

282,006

 

 

 

305,087

 

Right of use asset, net of accumulated amortization

 

 

4,496

 

 

 

5,287

 

Restricted cash

 

 

255

 

 

 

255

 

Other non-current assets

 

 

3,649

 

 

 

248

 

Total assets

 

$

366,344

 

 

$

395,595

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

12,330

 

 

$

9,809

 

Accrued expenses and other current liabilities

 

 

29,344

 

 

 

23,680

 

Current portion of lease liabilities

 

 

1,578

 

 

 

1,545

 

Current portion of acquired contingent consideration

 

 

2,577

 

 

 

2,532

 

Deferred revenue

 

 

465

 

 

 

384

 

Total current liabilities

 

 

46,294

 

 

 

37,950

 

Convertible senior notes

 

 

181,043

 

 

 

167,031

 

Non-current portion of acquired contingent consideration

 

 

30,223

 

 

 

38,668

 

Non-current portion of lease liabilities

 

 

3,468

 

 

 

4,341

 

Deferred tax liability

 

 

38,544

 

 

 

44,202

 

Other non-current liabilities

 

 

7,815

 

 

 

9,781

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock, $0.001 par value per share. Authorized 1,000,000 shares at September 30,
   2023 and December 31, 2022;
no shares issued as of September 30,
   2023 and December 31, 2022, respectively

 

 

 

 

 

 

Common stock, $0.001 par value per share. Authorized 3,083,333 shares at September 30,
   2023 and December 31, 2022; issued
1,242,376 shares,
   including those held in treasury, as of September 30, 2023 and
   December 31, 2022, respectively

 

 

1

 

 

 

24

 

Treasury stock at cost (278 shares at September 30, 2023 and
  December 31, 2022)

 

 

(638

)

 

 

(638

)

Additional paid-in capital

 

 

1,030,243

 

 

 

1,029,881

 

Accumulated deficit

 

 

(971,366

)

 

 

(936,273

)

Accumulated other comprehensive income

 

 

717

 

 

 

628

 

Total stockholders’ equity

 

 

58,957

 

 

 

93,622

 

Total liabilities and stockholders’ equity

 

$

366,344

 

 

$

395,595

 

 

See accompanying Unaudited Notes to Consolidated Financial Statements

1


 

ACORDA THERAPEUTICS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(unaudited)

 

(In thousands, except per share data)

 

Three-month period ended September 30, 2023

 

 

Three-month period ended September 30, 2022

 

 

Nine-month period ended September 30, 2023

 

 

Nine-month period ended September 30, 2022

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Net product revenues

 

$

25,179

 

 

$

29,964

 

 

$

69,863

 

 

$

76,023

 

Royalty revenues

 

 

2,502

 

 

 

3,047

 

 

 

9,717

 

 

 

10,573

 

License revenues

 

 

34

 

 

 

500

 

 

 

68

 

 

 

500

 

Total net revenues

 

 

27,715

 

 

 

33,511

 

 

 

79,648

 

 

 

87,096

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

3,387

 

 

 

11,005

 

 

 

9,685

 

 

 

25,772

 

Research and development

 

 

1,207

 

 

 

1,383

 

 

 

4,143

 

 

 

4,602

 

Selling, general and administrative

 

 

23,152

 

 

 

22,997

 

 

 

67,492

 

 

 

80,002

 

Amortization of intangible assets

 

 

7,691

 

 

 

7,691

 

 

 

23,073

 

 

 

23,073

 

Change in fair value of derivative liability

 

 

 

 

 

 

 

 

 

 

 

(37

)

Changes in fair value of acquired contingent consideration

 

 

(5,203

)

 

 

(4,576

)

 

 

(7,118

)

 

 

(10,709

)

Total operating expenses

 

 

30,234

 

 

 

38,500

 

 

 

97,275

 

 

 

122,703

 

Operating loss

 

 

(2,519

)

 

 

(4,989

)

 

 

(17,627

)

 

 

(35,607

)

Other income (expense), net:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and amortization of debt discount expense

 

 

(7,984

)

 

 

(7,465

)

 

 

(23,328

)

 

 

(22,501

)

Interest income

 

 

157

 

 

 

17

 

 

 

308

 

 

 

38

 

Realized gain (loss) on foreign currency transactions

 

 

288

 

 

 

(1

)

 

 

287

 

 

 

(1

)

Other income (expense)

 

 

115

 

 

 

 

 

 

209

 

 

 

1,250

 

Total other expense, net

 

 

(7,424

)

 

 

(7,449

)

 

 

(22,524

)

 

 

(21,214

)

Loss before taxes

 

 

(9,943

)

 

 

(12,438

)

 

 

(40,151

)

 

 

(56,821

)

Benefit from (provision for) income taxes

 

 

1,055

 

 

 

(1,416

)

 

 

5,058

 

 

 

(28,237

)

Net loss

 

$

(8,888

)

 

$

(13,854

)

 

$

(35,093

)

 

$

(85,058

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share—basic

 

$

(7.16

)

 

$

(11.17

)

 

$

(28.25

)

 

$

(97.66

)

Net loss per share—diluted

 

$

(7.16

)

 

$

(11.17

)

 

$

(28.25

)

 

$

(97.66

)

Weighted average common shares outstanding
   used in computing net loss per share—basic

 

 

1,242

 

 

 

1,240

 

 

 

1,242

 

 

 

871

 

Weighted average common shares outstanding
   used in computing net loss per share—diluted

 

 

1,242

 

 

 

1,240

 

 

 

1,242

 

 

 

871

 

 

See accompanying Unaudited Notes to Consolidated Financial Statements

2


 

ACORDA THERAPEUTICS, INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Loss)

(unaudited)

 

(In thousands)

 

Three-month period ended September 30, 2023

 

 

Three-month period ended September 30, 2022

 

 

Nine-month period ended September 30, 2023

 

 

Nine-month period ended September 30, 2022

 

Net loss

 

$

(8,888

)

 

$

(13,854

)

 

$

(35,093

)

 

$

(85,058

)

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(163

)

 

 

1,352

 

 

 

89

 

 

 

3,107

 

Other comprehensive income (loss), net of tax

 

 

(163

)

 

 

1,352

 

 

 

89

 

 

 

3,107

 

Comprehensive income (loss)

 

$

(9,051

)

 

$

(12,502

)

 

$

(35,004

)

 

$

(81,951

)

 

See accompanying Unaudited Notes to Consolidated Financial Statements

3


 

ACORDA THERAPEUTICS, INC. AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

Nine Months Ended September 30, 2023 and 2022

(unaudited)

 

 

 

Common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Number
of
shares

 

 

Par
value

 

 

Treasury stock

 

 

Additional
paid-in
capital

 

 

Accumulated
deficit

 

 

Accumulated
other
comprehensive
(loss)
income

 

 

Total
stockholders'
equity

 

Balance at December 31, 2022

 

 

1,242

 

 

$

24

 

 

$

(638

)

 

$

1,029,881

 

 

$

(936,273

)

 

$

628

 

 

$

93,622

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

71

 

 

 

 

 

 

 

 

 

71

 

Other comprehensive income,
   net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

91

 

 

 

91

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(16,824

)

 

 

 

 

 

(16,824

)

Balance at March 31, 2023

 

 

1,242

 

 

$

24

 

 

$

(638

)

 

$

1,029,952

 

 

 

(953,097

)

 

$

719

 

 

$

76,960

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

128

 

 

 

 

 

 

 

 

 

128

 

Reverse Stock Split Adjustment

 

 

 

 

 

(23

)

 

 

 

 

 

23

 

 

 

 

 

 

 

 

 

 

Other comprehensive income, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

161

 

 

 

161

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,381

)

 

 

 

 

 

(9,381

)

Balance at June 30, 2023

 

 

1,242

 

 

$

1

 

 

$

(638

)

 

$

1,030,103

 

 

$

(962,478

)

 

$

880

 

 

$

67,868

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

140

 

 

 

 

 

 

 

 

 

140

 

Other comprehensive income, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(163

)

 

 

(163

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(8,888

)

 

 

 

 

 

(8,888

)

Balance at September 30, 2023

 

 

1,242

 

 

$

1

 

 

$

(638

)

 

$

1,030,243

 

 

$

(971,366

)

 

$

717

 

 

$

58,957

 

 

 

 

 

4


 

 

 

Common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Number
of
shares

 

 

Par
value

 

 

Treasury stock

 

 

Additional
paid-in
capital

 

 

Accumulated
deficit

 

 

Accumulated
other
comprehensive
(loss)
income

 

 

Total
stockholders'
equity

 

Balance at December 31, 2021

 

 

13,250

 

 

$

13

 

 

$

(638

)

 

$

1,023,136

 

 

$

(870,357

)

 

$

(1,017

)

 

$

151,137

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

181

 

 

 

 

 

 

 

 

 

181

 

Compensation expense for
   issuance of restricted
   stock to employees

 

 

35

 

 

 

 

 

 

 

 

 

304

 

 

 

 

 

 

 

 

 

304

 

Other comprehensive income,
   net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

449

 

 

 

449

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(24,522

)

 

 

 

 

 

(24,522

)

Balance at March 31, 2022

 

 

13,285

 

 

$

13

 

 

$

(638

)

 

$

1,023,621

 

 

$

(894,879

)

 

$

(568

)

 

$

127,549

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

471

 

 

 

 

 

 

 

 

 

471

 

Interest payment for convertible notes

 

 

10,992

 

 

 

11

 

 

 

 

 

 

5,252

 

 

 

 

 

 

 

 

 

5,263

 

Other comprehensive income,
   net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,306

 

 

 

1,306

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(46,682

)

 

 

 

 

 

(46,682

)

Balance at June 30, 2022

 

 

24,277

 

 

$

24

 

 

$

(638

)

 

$

1,029,344

 

 

$

(941,561

)

 

$

738

 

 

$

87,907

 

Compensation expense for
   issuance of stock options
   to employees

 

 

 

 

 

 

 

 

 

 

 

364

 

 

 

 

 

 

 

 

 

364

 

Compensation expense for
   issuance of restricted
   stock to employees

 

 

61

 

 

 

 

 

 

 

 

 

(3

)

 

 

 

 

 

 

 

 

(3

)

Other comprehensive loss, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,352

 

 

 

1,352

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13,854

)

 

 

 

 

 

(13,854

)

Balance at September 30, 2022

 

 

24,338

 

 

$

24

 

 

$

(638

)

 

$

1,029,705

 

 

$

(955,415

)

 

$

2,090

 

 

$

75,766

 

 

See accompanying Unaudited Notes to Consolidated Financial Statements

5


 

ACORDA THERAPEUTICS, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(unaudited)

 

 

 

(In thousands)

 

Nine-month period ended September 30, 2023

 

 

Nine-month period ended September 30, 2022

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$

(35,093

)

 

$

(85,058

)

Adjustments to reconcile net loss to net cash used in
   operating activities:

 

 

 

 

 

 

Share-based compensation expense

 

 

340

 

 

 

1,320

 

Amortization of debt discount and debt issuance costs

 

 

14,012

 

 

 

12,356

 

Depreciation and amortization expense

 

 

23,743

 

 

 

24,770

 

Non-cash lease expense

 

 

(50

)

 

 

 

Change in acquired contingent consideration obligation

 

 

(7,118

)

 

 

(10,709

)

Non-cash royalty revenue

 

 

 

 

 

(4,762

)

Deferred tax (benefit) provision

 

 

(5,021

)

 

 

28,300

 

Change in derivative liability

 

 

 

 

 

(37

)

Changes in assets and liabilities:

 

 

 

 

 

 

Decrease in accounts receivable

 

 

1,889

 

 

 

2,312

 

Decrease (increase) in prepaid expenses and other current assets

 

 

547

 

 

 

(258

)

Decrease (increase) in inventory

 

 

(5,189

)

 

 

3,297

 

Increase in other assets

 

 

(3,401