Acorda's Prospects Remain Dubious Despite Inbrija Approval, Says Bearish Raymond James

Acorda Therapeutics Inc ACOR announced FDA approval for its Parkinson's drug Inbrija Monday, boosting the stock in premarket trading. Not everyone is sold on the product’s prospects.

The Analyst 

Raymond James analyst Laura Chico maintained an Underperform rating on the stock.

The Thesis

Raymond James had anticipated a delay of Inbrija's approval following the three-month pushback of its PDUFA date and submission of a Refuse to File Letter.

“Our confidence in a first-cycle Inbrija approval was admittedly not strong, so hats off indeed to the ACOR team for reaching an approval,” Chico said in a Monday note. (See her track record here.) 

The label exclusion of patients with chronic lung disease is seen to limit the drug's market share, but pricing could offset the moderated sales, the analyst said.

Until the official price disclosure near the first-quarter commercial launch, Chico models a doubled rate of $2,600 per quarter based on neurology approvals.

“The net of these changes drops our revenue estimates, necessitates incorporating multiple financings and yields an estimated fair value for ACOR shares [of] $9/share,” she said.

“Bottom line, while we commend the team for getting the approval, the road ahead remains challenging.”

The analyst dropped revenue forecasts to $23 million in 2019 and $82 million, $144 million and $184 million, respectively, in the following three years.

“While ACOR has the benefit of an experienced field force, midcap commercial launches have proven challenging in recent months,” Chico wrote, noting trouble in TESARO Inc TSRO’s Zejula and Dova Pharmaceuticals Inc DOVA’s Doptelet.

Price Action

Acorda shares were trading up slightly at $13.78 at the time of publication Wednesday. 

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