Acorda Therapeutics Inc. (ACOR) filed Quarterly Report for the period ended 2009-09-30.
Acorda Therapeutics is commercial-stage biopharmaceutical company dedicated to the identification development and commercialization of novel therapies that improve neurological function in people with multiple sclerosis spinal cord injury and other disorders of the central nervous system. Acorda currently markets Zanaflex Capsules for the management of spasticity. The Company's lead product candidate Fampridine-SR for the improvement of walking ability in persons with multiple sclerosis. It develops therapies that restore neurological function to people with spinal cord injury multiple sclerosis and related conditions of the nervous system. Acorda Therapeutics Inc. has a market cap of $892.9 million; its shares were traded at around $23.46 with and P/S ratio of 18.7.
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We recorded discounts and allowances of $1.6 million for the three-month period ended September 30, 2009 as compared to $1.2 million for the three-month period ended September 30, 2008. Discounts and allowances are recorded when Zanaflex Capsules and Zanaflex tablets are shipped to wholesalers. Discounts and allowances for the three-month period ended September 30, 2009 consisted of $785,000 in fees for services payable to wholesalers, $597,000 in allowances for chargebacks and rebates and $225,000 in cash discounts and patient program rebates. Discounts and allowances for the three-month period ended September 30, 2008 consisted of $651,000 in fees for services payable to wholesalers, $449,000 in allowances for chargebacks and rebates, and $124,000 in cash discounts and patient program rebates.
We recorded cost of sales of $2.6 million for the three-month period ended September 30, 2009 as compared to $2.7 million for the three-month period ended September 30, 2008. Cost of sales for the three-month period ended September 30, 2009 consisted of $1.4 million in inventory costs primarily related to recognized revenues, $878,000 in royalty fees based on net product shipments, $321,000 in amortization of intangible assets, which is unrelated to either the volume of shipments or the amount of revenue recognized, and $50,000 in period costs related to freight and stability testing. Cost of sales for the three-month period ended September 30, 2008 consisted of $1.3 million in inventory costs primarily related to recognized revenues, $741,000 in royalty fees based on net product shipments, $596,000 in amortization of intangible assets, which is unrelated to either the volume of shipments or the amount of revenue recognized, and $44,000 in period costs related to packaging, freight, and stability testing. Payments to and interest expense related to our Paul Royalty Fund (PRF) transaction discussed below in the section titled "Liquidity and Capital Resources" do not impact our cost of sales.
We recorded discounts and allowances of $6.0 million for the nine-month period ended September 30, 2009 as compared to $4.2 million for the nine-month period ended September 30, 2008. Discounts and allowances are recorded when Zanaflex Capsules and Zanaflex tablets are shipped to wholesalers. Discounts and allowances for the nine-month period ended September 30, 2009 consisted of $2.8 million in allowances for chargebacks and rebates which includes a Tricare rebate reserve of $990,000, of which $351,000 is related to the first three quarters of 2009 and an adjustment of $639,000 is related to 2008. These rebates and adjustments resulted from a Department of Defense (DOD) regulation finalized during the three-month period ended March 31, 2009 which purports to require manufacturers to pay rebates to DOD on utilization distributed to Tricare beneficiaries through retail pharmacies retroactive to January 28, 2008. The application of the regulation is currently being challenged in court by a coalition representing a number of manufacturers. Discounts and allowances for the nine-month period ended September 30, 2009 also consisted of $2.0 million in fees for services payable to wholesalers and $1.1 million in cash discounts and patient program rebates. Discounts and allowances for the nine-month period ended September 30, 2008 consisted of $1.6 million in fees for services payable to wholesalers, $1.5 million in allowances for chargebacks and rebates, and $1.1 million in cash discounts and patient program rebates.
We recorded cost of sales of $8.1 million for the nine-month period ended September 30, 2009 as compared to $8.5 million for the nine-month period ended September 30, 2008. The decrease was principally due to the decrease in amortization of intangible assets resulting from having completed the amortization of the Zanaflex trademark portion of our intangible asset as of December 31, 2008. Cost of sales for the nine-month period ended September 30, 2009 consisted of $4.2 million in inventory costs primarily related to recognized revenues, $2.8 million in royalty fees based on net product shipments, $962,000 in amortization of intangible assets, which is unrelated to either the volume of shipments or the amount of revenue recognized, and $152,000 in period costs related to freight and stability testing. Cost of sales for the nine-month period ended September 30, 2008 consisted of $4.0 million in inventory costs primarily related to recognized revenues, $2.5 million in royalty fees based on net product shipments, $1.8 million in amortization of intangible assets, which is unrelated to either the volume of shipments or the amount of revenue recognized, and $210,000 in period costs related to freight and stability testing. Payments to and interest expense related to our PRF transaction discussed below in the section titled "Liquidity and Capital Resources" do not impact our cost of sales.
General and administrative expenses for the nine-month period ended September 30, 2009 were $23.1 million compared to $17.4 million for the nine-month period ended September 30, 2008, an increase of approximately $5.7 million, or 33%. This increase was the result of an increase in staff and compensation and other expenses of $2.1 million related to supporting the growth of the overall organization, an increase in costs associated with medical affairs educational programs of $2.1 million, an increase in legal fees of $622,000 and an increase in business development expenses of $465,000 related to our collaboration and licensing agreement efforts.
Net cash provided by (used in) operations was $51.5 million and ($32.2) million for the nine-month period ended September 30, 2009 and 2008, respectively. Cash used in operations for the nine-month period ended September 30, 2009 was primarily attributable to a net loss of $61.5 million, an increase in the non-current portion of deferred cost of license revenue of $6.9 million and an increase in prepaid expenses and other current assets of $3.6 million. Cash used in operations for the nine-month period ended September 30, 2009, was partially offset by an increase in deferred license revenue of $107.6 million, a non-cash share-based compensation expense of $8.9 million, amortization of net premiums and discounts on short-term investments of $3.4 million, an increase in Zanaflex Capsules deferred product revenues of $2.5 million and depreciation and amortization of $2.1 million. Cash used in operations for the nine-month period ended September 30, 2008 was primarily attributable to a net loss of $54.1 million, amortization of the discount on short-term investments of $2.4 million, an increase in inventory held by others of $416,000, a decrease in Zanaflex tablets deferred product revenues of $142,000, and a gain on our put/call liability of $50,000. Cash used in operations for the nine-month period ended September 30, 2008, was partially offset by an increase in accounts payable, accrued expenses, and other current liabilities of $7.6 million, a non-cash share-based compensation expense of $7.1 million, a decrease in inventory held by the Company of $2.8 million, a non-cash expense for the acquisition of NRI assets of $2.7 million, depreciation and amortization of $2.5 million, an increase in Zanaflex Capsules deferred product revenues of $1.7 million, a decrease in accounts receivable of $249,000, and a decrease in prepaid expenses and other current assets of $236,000.
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