Silicon Motion: Sifting Through The Wreckage [View article]
Ashraf: on the cc, the company said that the LTE transceiver business with Samsung had been lost to Qualcomm, because Samsung had suddenly decided to adhere to the new "carrier aggregation" standard. This was apparently totally unanticipated by either party, or at least by SIMO. They plan to add the required feature in the next round of product improvements but, by that time (2014), one feels Qualcomm will have moved still further ahead. The company reps on the call sounded increasingly rueful, as the analysts battered them about the sudden and major hit to revenues for 2013, that this loss of the LTE business will effect.
Quite apart from all that, QonQ net sales decreased 19%, and diluted earnings per ADS (non-GAAP) decreased to $0.17 from $0.36. Q1 2013 earnings were also sharply below the 2012 Q1 result.
I am not disputing the ameliorating and more hopeful considerations you adduce, merely commenting that you might have been a little more forthright about the reasons for the fall in the stock from 16 to 10 in the last 3 months (and - yes - it is pretty clear that the LTE news was leaked to most everyone but the retail investors, some time ago).
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
pharmaman58: fabulously succinct and educational summary of the parameters for possible generic or synthetic competition - this matter is VITAL to the continuing QCOR investment thesis. TruffelPig (and others with his worries, expressed above) - ARE YOU LISTENING?! THEY ASKED THE FDA! Have you?
In addition to the educational material in Michael Fuller's articles on SA, those wishing to learn about Questcor and QCOR should make a point of researching the original posts of pharmaman58 and mikeylikesit33_99, on the QCOR Yahoo Message Board. This is NOT the usual dross you find on that site, but top class investor-education material on ALL phases (medical, economic, health-industry, technical), and is a resource NOT to be overlooked.
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
6869451: since you really are a physician, I apologize 100% for my insults and innuendoes. I gather you have had a discussion with Michael, so perhaps he has already posted you on the economic aspects of Questcor's situation.
Basically - when a company invests time and money for many years, enduring risk, uncertainty and multiple defeats and disappointments, then they expect to be able to recoup, if and when finally successful.
This basic scenario is multiplied when the indication (IS) has a (relatively) VERY low # of potential sales. That is why the US governments offers incentives like ODD, so that these babies can actually get good treatment. Even young Socialists had better understand these matters (or find life frustrating, as Socialists long have, in our era).
Please understand that Q's tribulations involved, among other things, solving multiple problems in controlling manufacturing quality, that Novartis apparently could not, and was ready to give up on. QCOR's 40 days and 40 nights in the wilderness were basically 2001-2010. You try it sometime.
If it turns out that prednis(ol)one is really "just as good", then IS will become just like Questcor's other indications, where - as I'm sure you know - Acthar is given only when much or all else have failed.
As already discussed, your callow notion - that Q is holding poor, sick people to ransom - does not hold up. It is often an "argument" used by shorts (ask Nomad!).
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
6869451: were you really a physician, as opposed to a thinly-disguised short/basher, you would know that patients with insurance are always covered by that provider (even if Aetna!), and that indigent patients without insurance are provided with free treatment by Questcor (or by a combination of Medicaid and Questcor).
If you just can't stand the thought of ANYONE paying that much money, you can always prescribe steroids, though the cure-rate is only about 1 in 3, and such treatment is not recommended 1st-line by the FDA.
The companies that provided Acthar before Questcor were universally planning on quitting doing so, for well-documented reasons, which is how Questcor became involved in the first place. As you should know, Questcor had many years of trial and experimentation, rejection by the FDA, and unproductive investment spending, until finally gaining the ODD and indications - so it is ridiculous to cite the uneconomic prices previously charged.
But then you're just another short in quack's clothing, right?
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
Truffel: I've usually enjoyed and valued your posts, but this one seems way below par, if I may say so.
. when compared to other ODD drugs, Acthar's price is middling: how would you justify "excessively expensive", ie. in relation to what - its utility to its consumers (life-saving)? . I know you are too sophisticated an investor in the biopharma space really to suppose that either a generic or synthetic competitor could emerge "overnight". In most cases literally years of FDA-monitored testing would be required. All this begins with a Phase 1 announcement (if not before), and there has been none. The Cerium short-story seems to have ended in the dustbin of history. Do you have some other evidence we are all missing? . while benzylalcohol could surely be omitted/replaced, would there not be a need for new clinical testing? Why hasn't Novartis already announced an effort? Perhaps they haven't heard about the US market and the immense and growing success of Acthar?
While your investments are your own concern, and though arguably the main risk to investing in QCOR seems to be precisely the kind of ignorance and irrational fear evinced in posts like yours, I venture to suggest you're missing a historic opportunity at least to double your money within a year. I recommend the 2014 and 2015 LEAPs for your perusal, if you still feel the common is too risky.
Intel: What Makes Mid-Year Different? [View article]
Russ: "If the miracle of making computers...doesn't cause you to catch your breath, you have no soul, and should try to find your way back to the caves...".
So if cavemen really had to contend not only with low living standards and life without ESPN, but also soullessness - when and how do you think it was that mankind acquired souls? :)
[You and I are both old enough to remember how galvanized the cavemen in the movie "2001" were by fire - if they had only seen Haswell, they might have invented back-flips.]
That said, I am inclined to forgive you your strange metaphysics, because nobody ever explained tick-tock to me before.
Todd: I remember your BAC articles from the Dark Days of 2011, and agree with Doyle's assessment above. I am also long AIG (though recently took some profits at 39, see below for a clue as to why).
However, would appreciate some clarification of the "AIG is undervalued by book value" thesis. I am not an accountant by training.
Is $60/share based on (1) the assets' original purchase prices, or on (2) a DCF capitalization of their current earning power, or on (3) what the assets could (theoretically) fetch on the market if sold today (AIG break-up)?
In 2012, AIG made about $4/share (giving them a pass on the Q4 charges). If $60 of asset value can produce only $4 of net income then P/E is ~15, which seems about in line with the S&P. If the income-producing power of the assets is somehow temporarily impaired (case (2) above), then I can understand the undervaluation thesis, but is this in fact the case?
If the above is NOT the case, and we go for case (3), then why would anyone pay the equivalent of $60/share if the assets can only produce $4? And if (1) is the BV basis, then it seems irrelevant to the PPS.
I'm trying to keep this as conceptually clear as your fine article, but not sure if I succeeded. I guess the BASIC question I have is that the BV argument is getting long-in-the-tooth now, and one wonders why Mr Market is so stubborn as not to give AIG its due, now that the Treasury is way in the rearview mirror? Could this latter thought perhaps help explain why Ben is not as eager as you to gorge on B/Bs? Just trying to provoke you into a caustic response. Knock this down, please.
S&P 1500 Most Heavily Shorted Stocks [View article]
BIG - just wanted to say "thanks" for posting this regularly. It is a valuable and interesting collation (imo).
The one stock in the list, the #4, that I really follow, is QCOR. There is no, repeat NO, rational reason to go short this stock. Quite the reverse, actually. The ONLY reason this stock goes down is precisely because shorts produce lying reports that are subsequently shown up as 100% false (CitronResearch, Lafferty, flyonturd, etc.). People used to say a lot of the short interest was boxed, ie. institutions hedging the short attacks, but I doubt it. They've had plenty of time to clear their positions now, with a change of year, and months of churning in the 20s and low 30s.
If someone can produce a valid reason to short QCOR, then my challenge is: post it hereunder! Convince more people, and we'll all go short too! [Deafening silence ensues...]
More commentary on Cliffs Natural Resources (CLF -13.3%) comes from Cowen's Anthony Rizzuto after meeting with CEO Joe Carrabba yesterday. Cowen thinks CLF is taking a "somewhat aggressive stance" on supply in the industry; CLF says moves by global iron ore producers away from greenfield investment could lead to a supply crunch over the medium term. (earlier: I, II) [View news story]
With MS and CS coming out with such bearish reports on the very same day, surely means they like CLF, but want to buy it a little cheaper.
Acthar Gel Outperforms Methylprednisolone In Head-To-Head Study In MS Patients [View article]
True, pingping, but if you study the abstract, you can see most of the results were quite (statistically) significant and ALL in the same direction.
One reads that a basic, basic difficulty with designing and executing double-blind research, in the case of a drug that patients and doctors alike strongly suspect works better than the competition, is getting half the guinea-pigs to accept that they might not be receiving the best treatment.
But, to a layman (like me) the hearsay evidence around the superior efficacy of HP Acthar Gel seems to be building all the time.
Acthar Gel Outperforms Methylprednisolone In Head-To-Head Study In MS Patients [View article]
As a lay investor, this seems pretty rich. Please allow me to summarize the "story so far", in dialog form, and correct me if I have it wrong:
AETNA (arms folded): Hmm, we can't find much evidence Acthar is more effective than steroids, so there's mostly no need for us to waste our profits on it.
QUESTCOR (palms up in supplication, mouth open wide in protest): we only want to sell to folks who don't get better on steroids, we're not claiming to be better in a head-to-head!!
AMERICAN ACADEMY OF NEUROLOGY: Ahem. Acthar IS TOO better in a head-to-head.
Thanks so much, Life Sci Advisors, for - once again - bringing immensely interesting QCOR news to our attention on SA.
Confession: I just bought even more Jan 18 2014 calls. $30 this time, and had to pay 7.70, most expensive deal I've yet done on QCOR - but I bet you I'll make a TON of money. Must stay diversified...must stay diversified....
The Shocking Truth About Insider Selling [View article]
Lou - great article, very enjoyable - because you write with style and panache (and without grade-school grammar errors), as well as merely having a clear message, cogently presented.
But something you wrote near the end is rather disquieting...
Since the basic evidence you adduce shows that insiders can't predict worth-a-sh*t, and are, if anything, valuable as a contrarian indicator - shouldn't we be worried that if a few mega-sales are subtracted out: "...the ratio of insider selling to buying is actually 10% below its average level of the past 12 months"?
Questcor: Results Of Rheumatology Physician Survey Show Strong Uptake Of Acthar [View article]
Drs. Stern and McDonald: thanks for posting a most interesting and different perspective for investors.
Seeing the apparently low proportions of MDs that responded to the surveys, I fell to wondering whether these were normal, or different for these surveys? Do you feel that MDs that did respond would self-select in any way relevant for the validity of the conclusions? For example, would MDs that had either a very positive or negative experience of drug effectiveness, or the reimbursement process, tend to reply? Are MDs that do not respond at all those that never use, or would want to use, Acthar?
In addition, may I ask who finances Life Sci Advisors, and these surveys in particular?
Finally, in case these questions sound skeptical or even hostile, I am only wanting to understand just how favorably I can interpret your welcome news. QCOR is altogether a larger proportion of my long portfolio than perhaps it ought to be.
Post Guidance Bomb, LinkedIn Is Still Insanely Expensive [View article]
Silicon Motion: Sifting Through The Wreckage [View article]
Quite apart from all that, QonQ net sales decreased 19%, and diluted earnings per ADS (non-GAAP) decreased to $0.17 from $0.36. Q1 2013 earnings were also sharply below the 2012 Q1 result.
I am not disputing the ameliorating and more hopeful considerations you adduce, merely commenting that you might have been a little more forthright about the reasons for the fall in the stock from 16 to 10 in the last 3 months (and - yes - it is pretty clear that the LTE news was leaked to most everyone but the retail investors, some time ago).
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
In addition to the educational material in Michael Fuller's articles on SA, those wishing to learn about Questcor and QCOR should make a point of researching the original posts of pharmaman58 and mikeylikesit33_99, on the QCOR Yahoo Message Board. This is NOT the usual dross you find on that site, but top class investor-education material on ALL phases (medical, economic, health-industry, technical), and is a resource NOT to be overlooked.
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
Basically - when a company invests time and money for many years, enduring risk, uncertainty and multiple defeats and disappointments, then they expect to be able to recoup, if and when finally successful.
This basic scenario is multiplied when the indication (IS) has a (relatively) VERY low # of potential sales. That is why the US governments offers incentives like ODD, so that these babies can actually get good treatment. Even young Socialists had better understand these matters (or find life frustrating, as Socialists long have, in our era).
Please understand that Q's tribulations involved, among other things, solving multiple problems in controlling manufacturing quality, that Novartis apparently could not, and was ready to give up on. QCOR's 40 days and 40 nights in the wilderness were basically 2001-2010. You try it sometime.
If it turns out that prednis(ol)one is really "just as good", then IS will become just like Questcor's other indications, where - as I'm sure you know - Acthar is given only when much or all else have failed.
As already discussed, your callow notion - that Q is holding poor, sick people to ransom - does not hold up. It is often an "argument" used by shorts (ask Nomad!).
Peace...
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
If you just can't stand the thought of ANYONE paying that much money, you can always prescribe steroids, though the cure-rate is only about 1 in 3, and such treatment is not recommended 1st-line by the FDA.
The companies that provided Acthar before Questcor were universally planning on quitting doing so, for well-documented reasons, which is how Questcor became involved in the first place. As you should know, Questcor had many years of trial and experimentation, rejection by the FDA, and unproductive investment spending, until finally gaining the ODD and indications - so it is ridiculous to cite the uneconomic prices previously charged.
But then you're just another short in quack's clothing, right?
Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
. when compared to other ODD drugs, Acthar's price is middling: how would you justify "excessively expensive", ie. in relation to what - its utility to its consumers (life-saving)?
. I know you are too sophisticated an investor in the biopharma space really to suppose that either a generic or synthetic competitor could emerge "overnight". In most cases literally years of FDA-monitored testing would be required. All this begins with a Phase 1 announcement (if not before), and there has been none. The Cerium short-story seems to have ended in the dustbin of history. Do you have some other evidence we are all missing?
. while benzylalcohol could surely be omitted/replaced, would there not be a need for new clinical testing? Why hasn't Novartis already announced an effort? Perhaps they haven't heard about the US market and the immense and growing success of Acthar?
While your investments are your own concern, and though arguably the main risk to investing in QCOR seems to be precisely the kind of ignorance and irrational fear evinced in posts like yours, I venture to suggest you're missing a historic opportunity at least to double your money within a year. I recommend the 2014 and 2015 LEAPs for your perusal, if you still feel the common is too risky.
Intel: What Makes Mid-Year Different? [View article]
So if cavemen really had to contend not only with low living standards and life without ESPN, but also soullessness - when and how do you think it was that mankind acquired souls? :)
[You and I are both old enough to remember how galvanized the cavemen in the movie "2001" were by fire - if they had only seen Haswell, they might have invented back-flips.]
That said, I am inclined to forgive you your strange metaphysics, because nobody ever explained tick-tock to me before.
Throwing Out The Baby With The Bathwater [View article]
An Open Letter To Bob Benmosche [View article]
However, would appreciate some clarification of the "AIG is undervalued by book value" thesis. I am not an accountant by training.
Is $60/share based on (1) the assets' original purchase prices, or on (2) a DCF capitalization of their current earning power, or on (3) what the assets could (theoretically) fetch on the market if sold today (AIG break-up)?
In 2012, AIG made about $4/share (giving them a pass on the Q4 charges). If $60 of asset value can produce only $4 of net income then P/E is ~15, which seems about in line with the S&P. If the income-producing power of the assets is somehow temporarily impaired (case (2) above), then I can understand the undervaluation thesis, but is this in fact the case?
If the above is NOT the case, and we go for case (3), then why would anyone pay the equivalent of $60/share if the assets can only produce $4? And if (1) is the BV basis, then it seems irrelevant to the PPS.
I'm trying to keep this as conceptually clear as your fine article, but not sure if I succeeded. I guess the BASIC question I have is that the BV argument is getting long-in-the-tooth now, and one wonders why Mr Market is so stubborn as not to give AIG its due, now that the Treasury is way in the rearview mirror? Could this latter thought perhaps help explain why Ben is not as eager as you to gorge on B/Bs? Just trying to provoke you into a caustic response. Knock this down, please.
S&P 1500 Most Heavily Shorted Stocks [View article]
The one stock in the list, the #4, that I really follow, is QCOR. There is no, repeat NO, rational reason to go short this stock. Quite the reverse, actually. The ONLY reason this stock goes down is precisely because shorts produce lying reports that are subsequently shown up as 100% false (CitronResearch, Lafferty, flyonturd, etc.). People used to say a lot of the short interest was boxed, ie. institutions hedging the short attacks, but I doubt it. They've had plenty of time to clear their positions now, with a change of year, and months of churning in the 20s and low 30s.
If someone can produce a valid reason to short QCOR, then my challenge is: post it hereunder! Convince more people, and we'll all go short too! [Deafening silence ensues...]
More commentary on Cliffs Natural Resources (CLF -13.3%) comes from Cowen's Anthony Rizzuto after meeting with CEO Joe Carrabba yesterday. Cowen thinks CLF is taking a "somewhat aggressive stance" on supply in the industry; CLF says moves by global iron ore producers away from greenfield investment could lead to a supply crunch over the medium term. (earlier: I, II) [View news story]
Acthar Gel Outperforms Methylprednisolone In Head-To-Head Study In MS Patients [View article]
One reads that a basic, basic difficulty with designing and executing double-blind research, in the case of a drug that patients and doctors alike strongly suspect works better than the competition, is getting half the guinea-pigs to accept that they might not be receiving the best treatment.
But, to a layman (like me) the hearsay evidence around the superior efficacy of HP Acthar Gel seems to be building all the time.
Acthar Gel Outperforms Methylprednisolone In Head-To-Head Study In MS Patients [View article]
AETNA (arms folded): Hmm, we can't find much evidence Acthar is more effective than steroids, so there's mostly no need for us to waste our profits on it.
QUESTCOR (palms up in supplication, mouth open wide in protest): we only want to sell to folks who don't get better on steroids, we're not claiming to be better in a head-to-head!!
AMERICAN ACADEMY OF NEUROLOGY: Ahem. Acthar IS TOO better in a head-to-head.
Thanks so much, Life Sci Advisors, for - once again - bringing immensely interesting QCOR news to our attention on SA.
Confession: I just bought even more Jan 18 2014 calls. $30 this time, and had to pay 7.70, most expensive deal I've yet done on QCOR - but I bet you I'll make a TON of money. Must stay diversified...must stay diversified....
The Shocking Truth About Insider Selling [View article]
But something you wrote near the end is rather disquieting...
Since the basic evidence you adduce shows that insiders can't predict worth-a-sh*t, and are, if anything, valuable as a contrarian indicator - shouldn't we be worried that if a few mega-sales are subtracted out: "...the ratio of insider selling to buying is actually 10% below its average level of the past 12 months"?
Sounds like we're in for a rout after all! :)
Questcor: Results Of Rheumatology Physician Survey Show Strong Uptake Of Acthar [View article]
Seeing the apparently low proportions of MDs that responded to the surveys, I fell to wondering whether these were normal, or different for these surveys? Do you feel that MDs that did respond would self-select in any way relevant for the validity of the conclusions? For example, would MDs that had either a very positive or negative experience of drug effectiveness, or the reimbursement process, tend to reply? Are MDs that do not respond at all those that never use, or would want to use, Acthar?
In addition, may I ask who finances Life Sci Advisors, and these surveys in particular?
Finally, in case these questions sound skeptical or even hostile, I am only wanting to understand just how favorably I can interpret your welcome news. QCOR is altogether a larger proportion of my long portfolio than perhaps it ought to be.