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At $28K a vial, Questcor's (QCOR) Acthar has propelled shares to huge gains. QCOR bought the...
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Sunday, December 30, 2012, 11:35 AM ETAt $28K a vial, Questcor's (QCOR) Acthar has propelled shares to huge gains. QCOR bought the drug for $100K in 2001, planning to produce it only to treat infantile spasms. But thanks to aggressive marketing, it's now being prescribed for MS, arthritis, and kidney disease. Aetna's (AET) decision to limit off-label treatments has hit shares, but it's not clear any viable alternatives are on the horizon. (NYT)
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According to http://bit.ly/R0hK7R the cost often goes to $150K per course for two courses.
Acthar is approximately 9 times the price of steroids, requires more expensive manufacturing, and was a money loser for decades. Previous company was losing 15 million per year when they sold it. So now you blame a company for buying the rights to it, and making an actual profit.
It was such a money loser, that before QCOR bought it, it was on the FDA shortage list twice in the late 1990s. No one could produce it at a profit but was a needed drug according to the FDA.
Not to mention your many spelling errors that show you not only made all that info up, but probably before you even had a cup of coffee that day.
Acthar's name comes from the main active ingredient ACTH, which your body produces in your pituitary and sends to you adrenal glands.
It is a precursor to your own body's steroids. Steroids that you need if you have an allergic reaction or other contraindication to steroids that were manufactured.
The NY Times article states that QCOR helps process 30 prescriptions a day. That works out to be about 650 or a month or less than 8000 a year. That's a tiny number in a grand scheme of things. How much should QCOR lower the price of the Acthar to stay profitable? I am sure if it's so lucrative and easy money, the big pharmas will be knocking on their doors by now.
Citron and StreetSweepers are short selling entities that are in it to make a quick bucks. Some of their arguments are valid, but when the stock started to recover from their attacks, they resorted back to their playbook of spreading misinformation - to create fear, uncertainty and doubts.
When these don't work, then there is little available in the market that can address these flares. Questcor is pricing based on supply/demand factors-- when there is a viable product that can compete after corticosteriods, then the price will go down.
Questcor tried at one time to use Acthar as a first line of defense in several inflammatory diseases-- and almost went bankrupt because they couldn't compete directly against corticosteriod alternatives.
The pricing keeps the company viable. The risk is that there's another viable alternative in 3rd line therapy-- or if someone else figures out the biologic makeup of the drug and start making generic Achthar vials. This is literally a one-hit wonder for the company... which should really make one think.
Managed care providers have every right to make the case for Acthar therapy a bigger uphill battle... and they are doing it. Interestingly enough, it isn't stopping patients who are really needing the therapy from getting it.
If managed care is reimbursing the drug, which they are under increasingly higher hurdles, they are also doing so under their own guidelines. Perhaps your arguments should be direct there as well.
If one wants to take a moral stance on drug pricing for Acthar-- that is fine (I think there are literally dozens of other drugs that meet that criteria). But the legal and economic arguments have all fallen short of the mark.
I think there are a whole lot of interested parties hoping that there is either a valid legal challenge on the horizon, or something on the R&D front that will force some competiton in these niche markets (whether its a generic equivalent or a branded drug). But until one gets to that point, QCOR will be a very profitable company-- with a whole lot of short sellers pumping and then dumping the stock.
You need to do research on what Acthar is and what it does. In depth research, not short articles. Pick up an A&P textbook and go to the endocrinology section. Even a dental hygienist has to pass a test on what ACTH is, so this isn't rocket science and you can understand that chapter.
But the mere suggesstion that what QCOR is doing in the marketplace is a "scam" is just ridiculous. QCOR is providing a therapy for a very narrow segment of the patient population, and they are pricing it in a relatively free market. Government and private insurers are paying for it. If you happen to find the "scam", I'm sure those entities are more than willing to listen.
I think the real risks behind QCOR are not really what people are focusing on today. If you are getting massive profits from a one drug wonder where the patents have already expired-- you better start making the upfront investments in R&D to significantly broaden your product pipeline.
To that end, it appears that QCOR management is content on milking the Achthar golden goose as much as they possibly can in the near term. And i think that ultimately becomes a big mistake.
In the meantime, QCOR will continue to be a very profitable company that will remain a favorite targets for shorts. This stock can be pumped higher on fundamentals alone-- and it will continue to be exposed to short sellers willing to find a nugget or two that can challenge the business model.
Sure, and by the way can you enlighten us more about Qcor. I was really impressed by your suggestions on Qcor. You should be hired by Citron as your insights into biotech stocks might help them more. You are a smart man indeed??
If MSFT CEO Bill didn't sign a fantastic contract with IBM for the first DOS, which IBM considered to be a fantastic deal for them... well, I don't need to finish that do I?
If investigation results in no action, then QCOR skyrockets, watch out shorts?
See how that works? Not helpful is it? Neither are your comments.
As for the price, $28k is nothing. Cancer drugs can cost $100k to prolong life for 3 months.
Previous company lost 15 million a year trying to manufacture this drug and had a lot of problems with purification. Mad cow disease kept creeping in.
Research people, most of the comments here show zero research except in reading short articles.
As for the issue with price gouging, there are literally dozens and dozens of drug therapies out there that serve very small patient populations and priced in a similar way. One drug that comes to mind in Cinryze, a drug used to treat heriditary angiodema attacks (produced by ViroPharma). A few weeks use of that drug usually runs in the range of $75k to $125k.
I think the problematic issue with QCOR is what they are doing with the profits. While they could easily acquire an emerging R&D pipeline, or invest internally in their own, they prefer to harvest Acthar for all it can. And I don't think that will serve their best interests in the long run, for a number of reasons.