Questcor tumbles as NY Attorney's Office joins Pennsylvania investigation


Questcor's (QCOR) Q3 results come in ahead of estimates as sales rise 68% Y/Y to $236.3M.

Acthar shipments for the quarter rise 45% on year to 8,132 vials. CEO Don Bailey says the strong Q3 growth was driven by "continued increase in Acthar usage among both rheumatologists and nephrologists." Investors will recall Mizuho's prediction that Acthar sales would hit $219-242M versus consensus of $195M.

New paid prescriptions rose 30% for the period to ~2,500. (PR)

Despite the solid results for Acthar, QCOR is off 10% AH as investors learned on the CC that the U.S. Attorney's Office for the Southern District of New York and the L.A. SEC Office have joined the investigation by the U.S. Attorney's Office for the Eastern District of Pennsylvania.

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Comments (13)
  • Hoang6
    , contributor
    Comments (358) | Send Message
     
    Why the news was not released yesterday or last week, but waited until after the ER? This smells like fish, holding strong!
    29 Oct 2013, 05:54 PM Reply Like
  • fafatooey
    , contributor
    Comments (434) | Send Message
     
    QCOR. Going down. Sold all here and took profits. Too many District Attorneys involved now. ONE of them at least will find something.
    29 Oct 2013, 06:16 PM Reply Like
  • loufah
    , contributor
    Comments (307) | Send Message
     
    So, three is "too many"? Out of thousands of DAs in the country?
    31 Oct 2013, 04:22 AM Reply Like
  • Hoang6
    , contributor
    Comments (358) | Send Message
     
    Explain to me why they waited until after the ER to talk about this? Why not before that because I'm sure this information must exist before that!
    29 Oct 2013, 06:24 PM Reply Like
  • Mongoose7916
    , contributor
    Comments (233) | Send Message
     
    Not sure when they found out but there are quiet periods before earnings reports.
    29 Oct 2013, 06:41 PM Reply Like
  • Bc12852
    , contributor
    Comments (147) | Send Message
     
    Over reaction to an old investigation. Qcor has sales growth and eps growth to back up previous forward looking statements. LA SEC office likely involved because they are closest to QCOR headquarters. Not enough attention to another blowout earnings announcement. Top and bottom line growth continues to amaze. This is another great buying opportunity.
    29 Oct 2013, 09:52 PM Reply Like
  • Jhone99
    , contributor
    Comment (1) | Send Message
     
    Seems like old news. It was the SEC's LA office not Lousiana.
    29 Oct 2013, 10:03 PM Reply Like
  • Growfast
    , contributor
    Comments (293) | Send Message
     
    If investigations yield nothing significant, perhaps $QCOR will explode to the upside. The pps has been hampered with this investigation for several months now while the company continues to deliver very strong performance. Seems the shorts may be out to save their bacon any way they can. Look at $NQ.

     

    All companies trading on these exchanges are on watch and subject to investigation. If they are doing something wrong, we as investors want to know. But, seems ridiculous the stacks of false accusations that appear to be nothing more than attempt to save face on short positions that have gotten out of control.

     

    Time will tell. Even if investigations find any issues, hard to believe they will be significant (highly costly to $QCOR). Nothing I have seen indicates accounting fraud, causes for a run on the bank or anything along those lines. Allegations if anything seem to indicate some potentially questionable dealings with a partner company or set of companies. But those did not appear to indicate wrongdoing on the part of $QCOR.
    30 Oct 2013, 12:22 AM Reply Like
  • seekingthetrooth
    , contributor
    Comments (854) | Send Message
     
    If QCOR is slapped with US$500 million fine today amid the stellar performance, even after accounting for this potential charge-off, my view is that stock is still undervalued by over 20% from Tue closing price based on conservative growth estimates that I estimate to run-off after 5 years towards the current 10-year treasury rate (2.5-2.7%) with cash-flows discounted at rates akin to those of junk bonds.

     

    With reasonable certainty on insurance claims settlements along with gradual build-up of evidence on predictability of cash flows, no significant inconsistencies in communication with shareholders, share buybacks & dividends and clearly defined growth strategy, this stock is one of the few game changers out there for grabs.
    30 Oct 2013, 04:45 AM Reply Like
  • lockeptrv
    , contributor
    Comments (22) | Send Message
     
    Are there possibly people ('friends') in these attorneys' offices who are manipulating this stock's price? Where are the shorts?
    30 Oct 2013, 10:01 AM Reply Like
  • loufah
    , contributor
    Comments (307) | Send Message
     
    And they would risk their careers and jail time... why?
    31 Oct 2013, 07:03 AM Reply Like
  • 214
    , contributor
    Comments (16) | Send Message
     
    My wife had control of the flicky and thus I had to watch The Good Wife while I was doing my investment homework. The series dealt with backdoor pressures and influence, I turned to my wife and said they did a good job outlining what can go on in the justice dept that can influence share prices and push other people agendas. This action on QCOR looks so much like this. I own deep in the money long term option, thus I will watch whether previous up gaps hold and let this smoke settle before making any brash decisions. I wud suggest buy this move and carry a tight stop for a good trade. Hold a core position with normal stops.
    30 Oct 2013, 10:44 AM Reply Like
  • Afam Edozie
    , contributor
    Comments (254) | Send Message
     
    In the short run the market is a voting machine, in the long run a weighing machine.

     

    Stock has more than doubled for the year. I'm still a happy camper (though less happy than yesterday). My expectation is that the stock will trade in the 54 to 70 range for the rest of the year. If it drops and stays below 54, I will take my profits and wait to see where it hits bottom.

     

    Otherwise I will rest easy. I suspect today is a good buy opportunity, but I'm already fully weighted and I'm trying not to be stupid, particularly since the market is already very high.
    30 Oct 2013, 01:18 PM Reply Like
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