Jobs are on the chopping block at Acorda Therapeutics and Alkermes as each company works to cut costs and stay alive. Acorda will lay off about one-quarter of its employees, while Alkermes will cut 160 jobs.
Acorda will cut about 25% of its staffers, starting “immediately,” the company said Wednesday. The plan, which is set to conclude in the first quarter of 2020, aims to reduce costs and allow Acorda to throw the resources it has behind the launch of Parkinson’s disease med Inbrija. The drug, an inhaled form of levodopa, earned the FDA nod last December to treat so-called “off” episodes during which Parkinson’s symptoms return between doses of standard treatment carbidopa/levodopa.
In January this year, the company moved its entire sales force for multiple sclerosis drug Ampyra over to Inbrija. Though Ampyra is still raking in $38 million per quarter in spite of generic competition, “investors don't want to give much credit as it's a generic and could fall,” wrote Jefferies analyst Michael Yee in a note.
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Yee pointed to a potential buyout as a "logical" move as “a bigger company could easily sell this [Inbrija] better than a small biotech.”
“A big co could have acquired this but going through the whole cost-cutting means less is probably happening soon. ABBV and AGN had notable Parkinson's efforts but they are busy merging now, and other Parkinson's assets have been slow,” he wrote.
As for Alkermes, the biotech said Wednesday it would lay off about 160 employees, cut back its future hiring plans and reduce spending in an effort to save $150 million. The move, which will cost the company $15 million, follows the FDA rejection of its depression drug ALKS 5461 in February and a quarter during which the company posted a net loss of $52.9 million.
"The restructuring is designed to further focus our R&D efforts on specific high-potential programs within CNS and oncology, improve financial efficiencies in our SG&A organization and drive growth," said Alkermes CEO Richard Pops in a statement.
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“We believe the plan helps offsets what has been a tough environment for Vivitrol and Aristada sales growth and provides some fin'l flexibility in the near-term. The next data event for the co is '4230 data at SITC, however, we don't expect this to be stock catalyst,” wrote Jefferies analyst Biren Amin.
With ALKS 5461 out the window, Alkermes is focusing on its early-phase immuno-oncology program, ALKS 4230, and its schizophrenia drug, ALKS 3831. It plans to submit the latter for FDA approval this quarter, Pops said on the company’s third-quarter earnings call.
“We're also looking obviously at partnerships, both on the R&D side and the commercial side ultimately for 4230,” he said on the call.