Acorda Therapeutics, Inc. (ACOR - Free Report) announced that the U.S. Court of Appeals for the Federal Circuit upheld by a 2-to-1 vote the District Court's previous ruling to invalidate four patents of its key multiple sclerosis (MS) drug, Ampyra. This paves the way for the entry of a generic product, which can erode the drug’s sales.
Acorda’s stock plunged almost 25% on Monday on the disappointing news. Acorda’s stock is down 3.1% this year so far compared with 5.1% decrease of its industry.
In March last year, the U.S. District Court for the District of Delaware invalidated four patents pertaining to Ampyra — ‘685, ‘826, ‘703 and ‘437 patents — on the basis of obviousness. Originally, these patents were set to expire between 2025 and 2027. In July, the Federal Circuit denied Acorda’s plea for a preliminary injunction to avoid at-risk launches prior to the Appeals Court decision.
Acorda said the patents are valid and it will consider further appeal options.
Ampyra is currently approved in the United States for the improvement of walking in multiple sclerosis patients. Ampyra is available outside the United States under the trade name, Fampyra. Acorda has a licensing agreement with Biogen Inc. (BIIB - Free Report) for Fampyra in outside U.S markets. The drug generated revenues of $150.3 million in the second quarter of 2018, comprising almost 98% of the company’s total revenues.
Several companies including Teva Pharmaceutical Industries Ltd. (TEVA - Free Report) and Mylan (MYL - Free Report) have developed generic versions of Ampyra. Following the unfavorable Appeals Court ruling, multiple generic versions of the drug are expected to be launched, which will hurt the company’s top line significantly.
With the rejection of the appeal, the focus shifts to the Oct 15 PDUFA date for Acorda’s key pipeline candidate, Inbrija which has been developed for treating OFF periods in patients with Parkinson’s disease (PD).
Acorda currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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