(ACOR) Acorda Therapeutics Inks Deal with Medtronic

Acorda Therapeutics, Inc. (ACOR) recently entered into a licensing agreement with Medtronic, Inc. (MDT) for AC105. The company acquired worldwide development and commercialization rights to AC105.

The Candidate – AC105

Acorda intends to study AC105 as an acute treatment for patients who have suffered neurological trauma, such as spinal cord injury (SCI) and traumatic brain injury (TBI). The candidate has demonstrated neuroprotective properties and improvement of locomotor function in SCI and cognitive function in TBI when therapy was initiated within four hours of injury in preclinical studies.

Medtronic has evaluated the candidate in phase I studies conducted with healthy volunteers. Acorda intends to initially conduct phase II studies with the candidate for SCI. Other studies may subsequently be conducted for central nervous system indications like TBI and stroke.

AC105 enjoys fast-track status in the US for the improvement of functional recovery in acute SCI patients. Acorda intends to seek orphan drug status from the US Food and Drug Administration (FDA) and other regulatory authorities for the acute treatment of SCI.

Terms of the Agreement

Per the terms of the deal, Acorda will pay up to $32 million to Medtronic on the achievement of development and regulatory milestones in addition to a $3 million upfront payment. Medtronic will also be entitled to receive a single-digit royalty on product sales.

While Acorda’s development and commercialization rights are exclusive in all fields (including SCI, TBI and stroke) for certain formulations of the licensed compound, the company’s rights are exclusive for indications of interest to Acorda (including SCI, TBI, stroke and all other traumatic and ischemic central nervous system indications) for other formulations. Meanwhile, Medtronic has non-exclusive (with Acorda) development rights in specific areas, including certain areas of pain and musculoskeletal indications.

Neutral on Acorda

We currently have a Neutral recommendation on Acorda. The in-licensing of AC105 strengthens Acorda’s pipeline which currently consists of GGF2 (in early phase I studies for the treatment of heart failure) and preclinical programs in remyelination and spinal cord injury.

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