Acorda Therapeutics Files for Bankruptcy

PEARL RIVER—A firm that almost 13 years ago made headlines and was touted as a clear example of the burgeoning biopharmaceutical industry in Westchester and the Hudson Valley has filed for bankruptcy protection and will close its headquarters here by June 15.

Acorda Therapeutics, Inc. announced on April 1 that it entered into an asset purchase agreement with Merz Therapeutics to purchase substantially all of the assets of Acorda, including the rights to its drugs INBRIJA, AMPYRA, and FAMPYRA for $185 million. Merz Therapeutics, a family-owned company Merz, headquartered in Frankfurt, Germany is serving as the “stalking horse” bidder. In connection with the deal, Acorda and certain of its affiliates filed voluntary petitions to commence Chapter 11 proceedings in the U.S. Bankruptcy Court for the Southern District of New York.

The same day, Acorda Therapeutics filed a WARN (Worker Adjustment and Retraining Notification) Notice with the New York State Department of Labor announcing its intent to close its headquarters operations at 2 Blue Hill Plaza in Pearl River beginning on April 3. The closure will be complete, affecting its 97 employees, by June 15, according to the WARN Notice.

Acorda Therapeutics stated the decision to file for Chapter 11 protection followed a lengthy strategic review during which the company explored a wide range of strategic options. The sale will be conducted through a court-supervised process under Section 363 of the U.S. Bankruptcy Code, which will provide potential buyers the opportunity to submit offers and is expected to conclude in June 2024.

Acorda Therapeutics develops therapies to restore function and improve the lives of people with neurological disorders. INBRIJA is approved for intermittent treatment of Parkinson’s disease patients treated with carbidopa/levodopa.

Ron Cohen, M.D., Acorda’s CEO and President, said, “Acorda’s management team and board have evaluated all of our strategic options, and following an exhaustive process believe that this option is in the best interest of stakeholders. One of our top priorities is to ensure an uninterrupted supply of our medications to people with multiple sclerosis and Parkinson’s disease. We are confident that Merz Therapeutics, if they are the ultimate acquirer, will be able to seamlessly continue serving these patients’ needs, given Merz’s longstanding dedication to improving the lives of people who suffer from movement disorders and other neurological conditions.”

The company stated that it will continue operations while it works to complete the sale process. The company has filed motions with the court seeking to ensure the continuation of normal operations during this process. Upon court approval, Acorda stated it expects to minimize the impact of the bankruptcy process on its employees, customers, patients, and other key stakeholders.

Acorda entered into a Restructuring Support Agreement with the holders of over 90% of its 6.00% Convertible Senior Secured Notes due 2024, which sets out certain milestones and conditions relating to the Section 363 sale process. In addition, in order to fund the continued operations of the Company during the bankruptcy process, Acorda and certain noteholders entered into a Debtor-in-Possession Financing Agreement to provide a $20-million term loan facility, which is also subject to court approval.

On April 3, Acorda Therapeutics announced that the Nasdaq Stock Market notified the company that it will suspend trading in and delist the company's common stock, effective with the opening of business on April 12. Once the delisting takes effect, Acorda expects its common stock to begin trading on the Pink Open Market (commonly referred to as the “pink sheets”).

The bankruptcy and expected sale of the company will be the close of what was back in 2011 a major success story for Westchester County. On June 27, 2011, Acorda Therapeutics, Inc. announced it would relocate from its corporate headquarters in Hawthorne to 138,000 square feet of space at the Ardsley complex that was recently purchased by BioMed Realty Trust, Inc. of San Diego, CA for $18 million.

In a story published in the July 2011 edition of Real Estate In-Depth, Acorda began with just six employees in 1998, according to Acorda CFO David Lawrence, who spoke at a press conference announcing the firm’s relocation. The company at that time had more than 300 workers.

Westchester County officials stated that the purchase of the complex by BioMed Realty Trust and Acorda Therapeutic’s expansion lease deal signified Westchester County’s 9A corridor’s emergence “as one of the hottest biotech addresses in the nation.”

In connection with its relocation to Ardsley, the company was eligible for up to $1.1 million in sales tax abatements through the Westchester County Industrial Development Agency. Some of which could be used by BioMed Realty in relation to tenant fit-out work. Acorda was also eligible for up to $5.2 million in tax credits as part of New York State’s Excelsior Jobs Program through Empire State Development Corp. The firm was also expected to secure some incentives from the New York State Energy and Research Authority (NYSERDA).

However, trouble began to emerge almost two years ago. According to a Form 10-K SEC filing on March 14, 2023, the company reported it had exercised its early termination option on what was 160,000 square feet of space at the Ardsley complex. The company paid an early termination fee of $4.7 million in June 2022 and relocated its headquarters to a substantially smaller subleased space in Pearl River. The six-year sublease deal in Pearl River was for approximately 21,000 square feet of space, the SEC filing stated.