Potentially game changing data awaits Acorda in 2013
NEW YORK (Reuters) - Acorda Therapeutics Inc Chief Executive Ron Cohen is already looking to spring, when data on a new use for its lone product could spur renewed investor interest and provide funding to enable his company to develop even more therapies.
The 2010 approval of Ampyra to improve walking in multiple sclerosis patients turned Acorda into a profitable company last year. If the drug can also help stroke victims who have suffered long term disability, it would open a large new market for Ampyra.
"If it works (in stroke) it's a game changer for us," Cohen told Reuters in the course of two recent conversations.
About half of the seven million people who have had a stroke have enough disability to make them potentially eligible for Ampyra treatment, Cohen said.
Ampyra, a drug that enhances signal transmission in damaged nerves, is expected to have sales in excess of $300 million next year, but company shares are down nearly 30 percent since the drug was launched in March of 2010.
An approval for stroke "could potentially double the company's sales," said RBC Capital Markets analyst Michael Yee.
"That is worth betting on given the significant upside," Yee said. "The stock is underappreciating just sales in MS, let alone another indication that could double the company's sales."
Data from the eagerly awaited midstage post stroke study is due out in the second quarter of 2013.
"Right now, we can say with confidence that people who have pet rats that have suffered stroke we can help," Cohen said with a chuckle.
The Phase II trial involves 66 people who suffered a stroke at least six months prior. "So it's chronic disabilities. We're measuring walking behavior as well as upper extremity disability," Cohen said.
Ampyra is also being tested in a 20-patient trial of adults with cerebral palsy. That data is expected by the middle of 2013, giving the company yet another shot on goal for its lone product. "It's one of those things you look at and go 'it should work'," Cohen said.
PIPELINE IN A PRODUCT
"The current pipeline is going to take a few years to mature even if it all works. One of the options is to have Ampyra in essence be a pipeline in a product," Cohen explained. "So if we can show that it applies elsewhere, that's going to help grow the company and enable us to do a lot more things."
Acorda, which has more than $300 million in cash, is also looking to add products through deals.
"Would we pay $100 million for an opportunity? Sure, if we thought it was going to be a big enough opportunity. We're looking for things that we think could get to market within the next couple of years," said the 56-year-old Cohen, a former practicing doctor who once "had pretensions to be an actor" - something he pursued for a few years in New York.
"You couldn't ask for a better training ground for what I do now, which is going out and raising money from investors. It's basically auditioning constantly and always being rejected," Cohen joked.
He said he began working on Acorda as a startup in late 1993. The company was incorporated in 1995. "I had no idea how drugs were developed. I knew how to administer them.
"It was amazing to me that it required this kind of money and effort," said Cohen, adding that Acorda raised $600 million to develop Ampyra. "We did it on the cheap."
Ardsley, New York-based Acorda will decide by the end of this year whether to exercise its option to buy Neuronex Inc and its nasal spray version of diazepam - the chemical name for Valium - to treat epileptic seizures. Acorda paid $2 million up front for the option and will have to pay only another $6.8 million to complete the acquisition.
By the end of next year, Cohen said, Acorda is likely to have three novel products move into clinical trials, including a molecule called GGF2, a nerve growth factor that holds promise for treating several debilitating conditions.
The first use to be tested will be for heart failure for which there are few good treatment options. It appears to work by "normalizing the metabolism of the damaged cells, so you actually get a more normal functioning heart muscle as opposed to something that reduces blood pressure so the heart is not taxed as much. So that's really exciting," Cohen explained.
GGF2 also has potential to help preserve or restore function even days after patients have suffered acute stroke, as well as address spinal cord injuries and restore erectile function following prostate surgery, Cohen said.
"The problem for us is we only have one drug generating revenue, so there's only so much we can invest in at one time."
But Cohen is anxious to see GGF2 tested on men for its potential to repair the cavernous nerve often damaged during delicate prostate surgery. About half the estimated 250,000 men who have prostate surgery each year suffer erectile dysfunction.
Researchers at Johns Hopkins have tested the theory on rats.
"The Hopkins group showed that if you apply this around the time of the injury the nerve grows back and you keep the erectile function," Cohen said. "So there are a lot of happy rats in Baltimore."