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Acorda Therapeutics Inc.’s (ACOR - Analyst Report) first quarter 2013 loss (including share-based compensation charges but excluding other special items) of 3 cents per share compared unfavorably with the Zacks Consensus Estimate of earnings of 18 cents and the year-ago earnings of 26 cents per share.

Quarterly revenues increased 0.9% to $71.9 million, missing the Zacks Consensus Estimate of $80 million.

Quarter in Detail

Bulk of net product revenues at Acorda came from Ampyra sales, which was approved by the US Food and Drug Administration (FDA) in Jan 2010 for the improvement of walking in multiple sclerosis patients. Ampyra sales came in at $62.3 million, reflecting a year-over-year increase of 8.5%. However, Ampyra revenues decreased 14.3% on a sequential basis. Revenues were affected by seasonal pattern.

Acorda has a licensing agreement with Biogen Idec (BIIB - Analyst Report) for the development and commercialization of Ampyra outside the US. Ampyra is available outside the US under the trade name Fampyra.

Fampyra royalties on ex-US sales increased 61.1% from the year-ago period to $2.9 million.

Zanaflex capsules and tablets recorded revenues of $4.4 million in the first quarter of 2013, down 55.1%. We note that Acorda has authorized Actavis, Inc. (ACT - Analyst Report) to commercialize the generic version of Zanaflex.

Acorda’s research and development (R&D) expenses increased 13.6% to $12.5 million. Selling, general and administrative (SG&A) expenses came in at $48.2 million, up 24.4% from the year-ago period.

Guidance for 2013

Acorda maintained its Ampyra revenue guidance of $285 million to $315 million. Acorda also reiterated its adjusted SG&A and R&D expense guidance. While the former is expected in the range of $170– $180 million, the latter is expected in the range of $60– $70 million. The guidance does not include costs related to the NeurogesX, Inc. acquisition.

Pipeline Update

Ampyra is being studied for other indications as well including cerebral palsy (encouraging efficacy data reported in Apr 2013 from a phase II proof-of-concept study, further analysis of data is ongoing) and post-stroke deficits (positive top-line data from a phase II proof-of-concept study reported in Apr 2013, further analysis of data is ongoing). The company plans to undertake further development of Ampyra for the post-stroke deficit indication.

In Dec 2012, Acorda completed the acquisition of privately-held Neuronex, Inc. The acquisition of Neuronex added diazepam nasal spray to Acorda’s neurology pipeline. Acorda is on track to submit an NDA for diazepam nasal spray for the management of seizure in certain epilepsy patients in 2013.

Our Take

Disappointing Ampyra sales in the first quarter of 2013 is concerning. Moreover, we remain worried about the company’s dependence on Ampyra for growth.

Acorda carries a Zacks Rank #3 (Hold). Pharma stocks that currently look attractive include companies like Isis Pharmaceuticals, Inc. (ISIS - Analyst Report), which carries a Zacks Rank #1 (Strong Buy).

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