Acorda Therapeutics Reports Second Quarter 2006 Financial Results.HAWTHORNE, N.Y. -- Acorda Therapeutics therapeutics Treatment and care to combat disease or alleviate pain or injury. Its tools include drugs, surgery, radiation therapy, mechanical devices, diet, and psychiatry. (R) (Nasdaq: ACOR ACOR Association of Cancer Online Resources ACOR American Center of Oriental Research ACOR Advanced Certificate in Operational Risk ACOR Assistant Contracting Officer Representative ACOR Actual Cost of Repair ACOR Administrative Contracting Officers Representative ) today announced its financial results for the quarter ended June 30, 2006. Recognized Revenue Reported For the quarter ended June 30, 2006, gross sales Gross Sales A measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. were $3.9 million for Zanaflex Zanaflex® Tizanidine Neurology An agent used to manage ↑ muscle tone in spasticity–eg, in spinal cord injury, multiple sclerosis. See Spasticity. Capsules(TM) (tizanidine hydrochloride tizanidine hydrochloride Zanaflex Pharmacologic class: Alpha-adrenergic agonist (centrally acting) Therapeutic class: Skeletal muscle relaxant Pregnancy risk category C Action) and $4.0 million for Zanaflex(R) (tizanidine hydrochloride) tablets. For the same quarter in 2005 we recognized gross sales of Zanaflex Capsules of $311,000 and gross sales of Zanaflex tablets of $167,000. Gross sales are recognized using a deferred revenue recognition model, where product shipments to wholesalers are recorded as deferred revenue, and later recognized as gross sales when end-user prescriptions are reported.During the quarter ended June 30, 2006, we adopted IMS Health IMS Health (NYSE: RX) is an international consulting and data services company that supplies the pharmaceutical industry with sales data and consulting services. IMS Health was founded in 1954 by Bill Frohlich and David Dubow. data as the prescription data source used as the basis for recognizing shipments of Zanaflex product as revenue. This change resulted in additional gross sales from prescriptions reported of $391,000 for Zanaflex Capsules and $230,000 for Zanaflex tablets. Additionally, on June 30, 2006, all rights of return expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. for prior shipments of short-dated lots of Zanaflex tablets inventory purchased as part of the 2004 Zanaflex acquisition and not previously recognized in gross sales. This resulted in the recognition of an additional $2.2 million of gross sales for the second quarter of 2006. Excluding the impact of this event and excluding the gross sales recognized due to the conversion to IMS Health prescription data, non-GAAP gross sales for the quarter ended June 30, 2006 would have been $5.1 million. The differences between non-GAAP and GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). gross sales of Zanaflex Capsules and Zanaflex tablets are reconciled in the table below. The Company believes it is appropriate to present this supplemental information as it will allow investors to better understand the Company's operating results for the second quarter of 2006 and its ongoing performance in a manner similar to how the Company analyzes its operating results. Adjustments and other factors make it more difficult to make meaningful period to period comparisons. These non-GAAP financial measures should not be construed as being more important than comparable GAAP measures. In the second quarter 2006, we recorded an adjustment to discounts and allowances to reflect the reversal of the remaining $1.8 million of an accrual accrual, n continually recurring short-term liabilities. Examples are accrued wages, taxes, and interest. made in 2004 to cover our exposure to returns of Zanaflex tablet See digitizer tablet and tablet computer. TABLET - A query language. ["Human Factor Comparison of a Procedural and a Non-procedural Query Language", C. Welty et al, ACM Trans Database Sys 6(4):626-649 (Dec 1981)]. product originally sold by Elan (Emulated LAN) A virtual LAN in the ATM world. See LANE and virtual LAN. Elan - ["Top-down Programming with Elan", C.H.A. Koster, Ellis Horwood 1987]. prior to our acquisition of the Zanaflex product line. Our obligation to continue to accept these returns ended on June 30, 2006, resulting in this adjustment. The impact of the change in prescription provider and events discussed above are detailed in the following schedule.
Detail on Second Quarter 2006 Sales Data
(in thousands)
(Unaudited)
Capsules Tablets Total
--------- -------- -------
GAAP/NON-GAAP RECONCILIATION
Non-GAAP gross sales $3,543 $1,526 $5,069
Change due to IMS Health prescription data 391 230 621
Expiration of right of short-dated Zanaflex
tablets - 2,202 2,202
returns
--------- -------- -------
GAAP gross sales for quarter ended 6-30-2006 $3,934 $3,958 $7,892
ADDITIONAL ITEMS
Less: Discounts and allowances (196) (73) (269)
Expiration of right of return - Elan sales - 1,801 1,801
--------- -------- -------
GAAP net sales for quarter ended 6-30-2006 $3,738 $5,686 $9,424
========= ======== =======
Shipments to wholesalers for the quarter ended June 30, 2006 of $5.9 million consisted of $4.3 million for Zanaflex Capsules and $1.6 million for Zanaflex tablets. For the same quarter in 2005, we recorded $8.4 million in shipments, consisting of $5.7 million in initial launch stocking shipments of Zanaflex Capsules and $2.7 million in Zanaflex tablets. The Zanaflex Capsules product was launched commercially in April 2005. Net loss for the quarter ended June 30, 2006 was $2.9 million or $.15 per share, compared to a net loss of $17.3 million or $85.88 per share for the same quarter in 2005. As of June 30, 2006, the Company held cash, cash equivalents and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments of $24.2 million. "We're pleased to report continued growth in Zanaflex sales during the second quarter of 2006," stated Ron Cohen cohen or kohen (Hebrew: “priest”) Jewish priest descended from Zadok (a descendant of Aaron), priest at the First Temple of Jerusalem. The biblical priesthood was hereditary and male. , M.D., President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "It was our first full quarter with our sales force expansion and we are already seeing results from this effort. Additionally, we are now using IMS (1) See IP Multimedia Subsystem. (2) (Information Management System) An early IBM hierarchical DBMS for IBM mainframes. IMS was widely implemented throughout the 1970s under MVS and continues to be used under z/OS. as our prescription data reporting vendor which collects more complete data to help us track our Zanaflex sales." Zanaflex Capsules Highlights --The clinical performance of Zanaflex Capsules has gained increased acceptance by physicians and patients. The first case study presentation of Zanaflex Capsules in a person with MS was made by Amy Morrison of the University of Texas Southwestern Department of Neurology neurology (n  rŏl`əjē, ny–), study of the morphology, physiology, and pathology of the human nervous system. at the June Consortium of MS Centers Annual Meeting. In addition,
several articles are being submitted for publication.--This quarter Acorda changed prescription data reporting vendors from NDC NDC National Drug Code NDC NATO Defense College NDC National Documentation Centre (National Hellenic Research Foundation, Athens, Greece) NDC National Dairy Council NDC National Democratic Congress to IMS. This change allows us to obtain more complete data because this data source accesses a larger portion of the market. Fampridine-SR Highlights --On July 12, 2006 we updated our estimate on the timing of the Phase 3 Fampridine-SR clinical trial in MS. We expect to report data from this trial in late September or October 2006. Conference Call and Webcast Ron Cohen, President and Chief Executive Officer, David Lawrence David Lawrence can refer to many people:
The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. will host a conference call today at 8:30 am Eastern Time to review the Company's second quarter 2006 results. To access the call, please dial 866-510-0704 (domestic) or 617-597-5362 (international) five minutes prior to the start time, and provide the access code 20529997. A replay of the call will be available from 10:30 a.m. Eastern Time on August 3, 2006 until 11:59 p.m. Eastern Time on September 3, 2006. To access the replay, please dial 888-286-8010 (domestic) or 617-801-6888 (international), and provide the access code 88067926. A live audio webcast of the call can also be accessed from the Company's website, at http://www.acorda.com, for the next 30 days. Forward Looking Statements This press release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 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 phase 3 clinical trial Phase 3 study. See Phase study. of Fampridine SR, delays in obtaining or failure to obtain FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. approval of Fampridine-SR, competition, the ability to obtain additional financing to support Acorda Therapeutics' operations, unfavorable results from its preclinical preclinical /pre·clin·i·cal/ (-klin´i-k'l) before a disease becomes clinically recognizable. pre·clin·i·cal adj. 1. 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 (Scalable Coherent Interface) An IEEE standard for a high-speed bus that uses wire or fiber-optic cable. It can transfer data up to 1GBytes/sec. (hardware) SCI - 1. Scalable Coherent Interface. 2. UART. , MS and related nervous system disorders Nervous system disorders A satisfactory classification of diseases of the nervous system should include not only the type of reaction (congenital malformation, infection, trauma, neoplasm, vascular diseases, and degenerative, metabolic, toxic, or deficiency . The Company's marketed products include Zanaflex Capsules(TM) (tizanidine hydrochloride), a short-acting drug indicated for the management of spasticity spasticity /spas·tic·i·ty/ (spas-tis´i-te) the state of being spastic; see spastic (2). spas·tic·i·ty n. 1. A spastic state or condition. 2. Spastic paralysis. . 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 Regeneration (biology) The process by which an animal restores a lost part of its body. Broadly defined, the term can include wound healing, tissue repair, and many kinds of restorative activities. and repair of the spinal cord spinal cord, the part of the nervous system occupying the hollow interior (vertebral canal) of the series of vertebrae that form the spinal column, technically known as the vertebral column. and brain. Financial Information
Acorda Therapeutics, Inc
Consolidated Statements of Operations
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2006 2005 2006 2005
-------- --------- -------- ---------
Gross sales - Zanaflex $7,892 $478 $11,766 $478
Less: discounts and allowances 1,532 (705) 1,336 (844)
-------- --------- -------- ---------
Net sales 9,424 (227) 13,102 (366)
Grant revenue 179 130 301 155
-------- --------- -------- ---------
Total net revenue 9,603 (97) 13,403 (211)
Less: cost of sales (1,344) (1,086) (2,385) (1,567)
-------- --------- -------- ---------
Gross profit 8,259 (1,183) 11,018 (1,778)
Operating expenses:
Research and development 3,021 5,040 6,298 7,143
Sales and marketing 4,282 3,067 8,845 5,369
General and administrative 3,560 1,821 5,838 3,933
-------- --------- -------- ---------
Total operating expenses 10,863 9,928 20,981 16,445
-------- --------- -------- ---------
Operating loss $(2,604) $(11,111) $(9,963) $(18,223)
-------- --------- -------- ---------
Other income (expense):
Interest and amortization of
debt discount expense (603) (371) (907) (520)
Interest income 311 148 573 258
Other income - 1 3 1
-------- --------- -------- ---------
(292) (222) (331) (261)
Cumulative effect of change in
accounting principle - - 454 -
-------- --------- -------- ---------
Net loss (2,896) (11,333) (9,840) (18,484)
-------- --------- -------- ---------
Beneficial conversion feature,
accretion of issuance costs,
preferred dividends, and fair
value of warrants issued to
convertible preferred
stockholders - (5,997) (36,007) (12,210)
-------- --------- -------- ---------
Net profit (loss) allocable to
common shareholders $(2,896) $(17,330) $(45,847) $(30,694)
========-=========-=========-=========
Net loss per share allocable
to common stockholders -
basic and diluted $(0.15) $(85.88) $(3.00) $(152.78)
Weighted average common shares
outstanding used in computing
net loss per share allocable
to common stockholders -
basic and diluted 19,629 202 15,278 201
Acorda Therapeutics, Inc
Consolidated Balance Sheet Data
(in thousands)
(Unaudited)
June 30, December 31,
2006 2005
---- ----
Assets
Cash and cash equivalents $23,684 $11,761
Short-term investments 500 2,001
Finished goods inventory held by the Company 6,245 5,587
Property and equipment, net 1,482 1,707
Intangible assets, net 5,583 5,952
Total assets $44,193 $33,912
Liabilities and stockholders' equity (deficit)
Accounts payable, accrued expenses and other
liabilities $6,291 $14,060
Deferred product revenue 14,311 16,736
Total current liabilities 23,965 35,858
Long term liabilities 22,427 23,377
Stockholders deficit (2,199) (116,536)
Total Liabilities and Stockholders deficit $44,193 $33,912
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