2 0 1 7 A N N U A L R E P O R T LE T TER FROM THE CEO Dear Shareholder: Acorda experienced a number of setbacks in 2017. Notwithstanding these challenges, we delivered positive Phase 3 and long-term safety studies for our innovative investigational Parkinson’s therapy, INBRIJA™ (levodopa inhalation powder). We also submitted an NDA (New Drug Application) for INBRIJA, which in February was accepted for filing by the FDA. And we recently submitted an MAA (Marketing Approval Application) for INBRIJA to the European Medicines Agency. Acorda’s Leadership Team, Board of Directors, and associates took decisive actions in 2017, and as a result Acorda has emerged in 2018 as a streamlined organization with a strong cash position, focused on the approval and successful US launch of INBRIJA. Ron Cohen, M.D. President and CEO 2017—CHALLENGES AND A MAJOR MILESTONE In March, a US district court invalidated four patents, which would have preserved market exclusivity for AMPYRA® (dalfampridine) into 2025. We strongly disagree with the In November, we announced the discontinuation of We presented the full Phase 3 efficacy and interim commercialization of INBRIJA. During the year, we also the tozadenant development program due to the long-term safety data sets in June 2017 at the annual emergence of the serious adverse event agranulocytosis International Congress of Parkinson’s Disease and and associated serious adverse events. At the time of Movement Disorders, both during the scientific sessions the discontinuation, over 90% of the participants had and at an investor webinar during the conference. These monetized the sales or royalty streams from several of our smaller commercial products, ZANAFLEX CAPSULES® (tizanidine HCl), FAMPYRA® (prolonged-release fampridine tablets), and SELINCRO TM (nalmefene), adding $57 million completed the study and we plan to present those data in presentations were enthusiastically received by both dollars to our cash balance. We closed 2017 with $307 court’s ruling and are in the process of appealing the future medical and scientific venues. healthcare professionals and investors. We were also million and also expect to end 2018 with over $300 million decision. We look forward to presenting our case in an oral assigned four platform presentations for our submissions in cash on hand. We are now well-capitalized for the argument to the appellate court, scheduled for June 7 of In the first quarter, we reported a major milestone— on INBRIJA data at the American Academy of Neurology launch of INBRIJA. this year. positive results from our INBRIJA Phase 3 efficacy and (AAN) conference on April 24. In June, we submitted an NDA for INBRIJA; the FDA primary endpoint, a statistically significant improvement FOCUS ON INBRIJA AND VALUE CREATION responded with a “Refusal to File” (RTF) letter, citing in motor function compared to placebo. The data from the long-term safety studies. The efficacy study met its INBRIJA—TARGETING AN IMPORTANT UNMET NEED IN PARKINSON’S two deficiencies unrelated to data that were readily long-term safety study in people with Parkinson’s showed In response to the challenges of 2017, we implemented INBRIJA is an investigational, self-administered, inhaled addressed. We resubmitted the NDA in December 2017 no differences in pulmonary function between the group and announced the FDA’s acceptance of the filing on February 20; the PDUFA target action date is October 5, receiving INBRIJA and an observational control group. Cough was the most frequently reported adverse event in a comprehensive corporate restructuring, streamlining the organization and its cost structure and significantly increasing our cash reserves. In March, immediately after form of levodopa that relies on the Company’s proprietary ARCUS® technology; it has been developed to address symptoms of OFF periods in people with Parkinson’s 2018. We also filed an MAA with the European Medicines both studies and was generally reported as mild. the district court’s ruling on AMPYRA, we substantially disease, who are on a carbidopa/levodopa-based regimen. Agency in March 2018. We plan to seek a partner for the commercialization of INBRIJA in ex-US territories. 2 reduced headcount and expenses, focusing the OFF periods are times throughout the day when a patient’s company on preparing for the manufacture, launch, and oral regimen of levodopa unpredictably wears off, leading 3 to the re-emergence of Parkinson’s symptoms. These with Parkinson’s, care partners, and advocacy groups. Our market penetration in five years; we believe that our SUMMARY OFF periods are considered by patients, care partners, and “Live Well. Do Tell.” initiative is the result of that meeting; successful neurology commercial experience and physicians to be one of the most debilitating and disruptive its goal is to encourage productive conversations about infrastructure provide a solid foundation for the successful aspects of the disease. In a 2014 survey of more than Parkinson’s symptoms among those living with the launch of INBRIJA. 3,000 people with Parkinson’s conducted by the Michael J. condition, their families, care partners, and healthcare Fox Foundation, 64% of respondents reported greater than professionals. Our Facebook page, “The Many Faces of ARCUS two hours of OFF time per day. OFF”, is the most successful industry-sponsored page in the Parkinson’s space, with over 87,000 “likes” and over Both healthcare professionals and people with Parkinson’s 250,000 video views since it was launched in late 2016. consider oral levodopa to be the gold standard of treatment for Parkinson’s, and we have heard consistent enthusiasm for an inhaled form of levodopa to treat OFF LEADING SPECIALTY SALES AND MARKETING ORGANIZATION Challenges are inevitable in drug development, in which about 90% of drugs that go into human clinical trials ultimately fail. We clustered a number of these challenges in 2017, at the same time achieving major successes in the INBRIJA development program. We have learned from our setbacks, and Acorda has emerged as a more focused, efficient, and high-performing organization—one that is poised to make INBRIJA an important drug launch in the Our proprietary ARCUS drug delivery technology emerged from the laboratory of Dr. Robert S. Langer, and was developed in collaboration with the Massachusetts Institute of Technology. We believe it will be an important Parkinson’s space. platform for the future growth of Acorda. Currently, we are working on an inhaled product for rapid relief of We anticipate the following key milestones in the next periods. Based on our extensive market research and our increased understanding of the Parkinson’s space, we have increased our US peak net sales figure for INBRIJA to greater than $800 million. Since the launch of AMPYRA, Acorda has developed one migraine, and also are working with the Bill & Melinda 12 months: of the most effective specialty sales teams in the US. Gates Foundation to develop a dry powder version of lung Our current sales force is appropriately scaled to address surfactant, a treatment for neonatal respiratory distress • INBRIJA: Approval and commercialization • AMPYRA: Oral argument and decision for appeal of movement disorder specialists throughout the US. Our syndrome. While the surfactant program is not aimed district court decision AN EMERGING LEADER IN THE PARKINSON’S COMMUNITY customer service hub for AMPYRA allows us to address at developing a commercial product, our work here will patient issues with prescription fulfillment and insurance be helpful in adapting ARCUS in developing additional coverage and to monitor compliance. There also are commercial pediatric uses; we are currently evaluating Over the past two years, we have held a number of considerable parallels between AMPYRA and INBRIJA— several potential applications. advisory boards across a wide range of audiences. In September, Acorda convened a multi-disciplinary advisory both are therapies that address a symptom of a disease that is not well understood or articulated by healthcare board meeting that included the “four pillars” of the professionals or patients. AMPYRA was the top Parkinson’s community: healthcare professionals, people specialty drug launch of 2010 and achieved 50% target 4 On behalf of our Leadership Team, Board of Directors, and our associates, thank you, our shareholders, for your continued support. We look forward to delivering on Acorda’s opportunities for building substantial value in 2018 and beyond. Ron Cohen, M.D. President and CEO 5 MANAGEMENT MANAGEMENT TEAM Ron Cohen, M.D. President and Chief Executive Officer David Lawrence, M.B.A. Chief, Business Operations, and Principal Accounting Officer Richard P. Batycky, Ph.D. Chief Technology Officer and Site Head Burkhard Blank, M.D. Chief Medical Officer Denise Duca, Ed.M. Executive Vice President, Human Resources Andrew A. Hindman Chief Business Officer Lauren Sabella Chief Commercial Officer Tierney Saccavino Executive Vice President, Corporate Communications Jane Wasman, J.D. President, International and General Counsel BOARD OF DIRECTORS Ron Cohen, M.D. Founder Lorin J. Randall Board Member since 2006 Barry Greene Steven M. Rauscher Board Member since 2007 Board Member since 2005 Peder K. Jensen, M.D. Ian F. Smith Board Member since 2011 Board Member since 2007 John P. Kelley Board Member since 2008 Catherine D. Strader, Ph.D. Board Member since 2017 Sandra Panem, Ph.D. Board Member since 1998 6 Contact: Felicia Vonella Executive Director, Investor Relations fvonella@acorda.com 914-326-5146 ARCUS is a registered trademark of Precision BioSciences, Inc. ACORDA THERAPEUTICS, the stylized ACORDA THERAPEUTICS logo, AMPYRA, FAMPYRA, and ZANAFLEX are registered trademarks of Acorda Therapeutics, Inc. INBRIJA and “Live Well. Do Tell.” are trademarks of Acorda Therapeutics, Inc. THE MANY FACES OF OFF is a service mark of Acorda Therapeutics, Inc. SELINCRO is a trademark of H. Lundbeck A/S. ©2018 Acorda Therapeutics, Inc. All rights reserved.