Struggling Acorda team brings out the axe — yet again — to chop away at costs as sales sputter
With its market value mired deep in the cellar of microcap stocks and its franchise drug struggling to gain traction, Acorda CEO Ron Cohen is once again bringing out the budget ax to chop away at what remains of the once high-flying biotech.
Acorda is now letting go 15% of the remaining staff — there’s no head count on that — with plans to start additional outsourcing. Combining those cuts should deliver $20 million in annual savings as the biotech looks to stop the chronic flow of red ink.
Acorda $ACOR was brought low back in 2018 after it lost patent protection on Ampyra, with generics eating into its one-time cash cow — which now delivers a little more than $20 million a quarter. The Acorda team had raced ahead with a new drug, Inbrija, but have managed only minuscule sales that ticked up to $6.4 million in Q2, leading to a loss of $23 million.
Against that backdrop, Cohen has been forced to cut and cut again.
Cohen was forced to cut a quarter of his staff in the fall of 2019, when cash reserves were at $253 million. That followed a major restructuring in 2017, as Acorda braced for the impact of generic competition. And it’s been selling assets along the way, including its manufacturing and packaging ops, which went to Catalent early this year.
Cohen credited the company, though, vowing to do better once the pandemic fades:
When the pandemic subsides, we believe that we will have the opportunity to accelerate Inbrija’s trajectory, as in-person interactions with health care providers and patients return to more normal levels. The headcount reductions and structural changes we have made will enable us to operate more efficiently and further align our expenses with revenue, while continuing to grow Inbrija sales.