Shares of Acorda Therapeutics, Inc. (NASDAQ: ACOR) were down 9.8% on the news of the issuance of a Complete Response Letter (NYSE: CRL) by the U.S. Food and Drug Administration (FDA) for the New Drug Application (NDA) for Plumiaz nasal spray.
Acorda is looking to get Plumiaz approved for the treatment of patients with epilepsy who experience cluster seizures. Consequently, Acorda does not expect Plumiaz to receive FDA approval in 2014.
Meanwhile, Acorda will work closely with the FDA to address the issues outlined in the CRL and refile the NDA.
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Our Take
The delay in Plumiaz's approval was disappointing. Acorda was planning a potential launch of Plumiaz in 2014. We remind investors that Acorda acquired Neuronex in Dec 2012 and added Plumiaz to its pipeline. Acorda estimated that peak sales of Plumiaz on approval could exceed $100 million.
Hence, we expect investor focus to remain on Plumiaz updates.
We note that Acorda is overly dependent on Ampyra (phase III study for post-stroke deficits) for top-line growth. Ampyra was approved by the U.S. Food and Drug Administration (FDA) in Jan 2010 for the improvement of walking in multiple sclerosis (NYSE: MS) patients. Acorda's Ampyra is marketed in the ex-U.S. markets under the trade name Fampyra by Biogen Idec (NASDAQ: BIIB).
Nevertheless, besides studying Ampyra for additional indications, the company is evaluating other candidates like GGF2 (second phase I study ongoing with results due in 2015), rHIgM22 (phase I ongoing with results due in 2015), and AC105 (phase II study ongoing for spinal cord injury).
Acorda is Zacks Rank #2 (Buy) stock. Other stocks that look attractive in the same sector include Gilead Sciences (NASDAQ: GILD) and Alexion Pharmaceuticals, Inc. (NASDAQ: ALXN). Both are Zacks Rank #1 (Strong Buy) stocks.
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