Questcor profit leaps on sales of Acthar gel
ANAHEIM, Calif. (AP) — Specialty drugmaker Questcor said on Tuesday that its third-quarter profit more than doubled on greater sales of its only product, an injectable prescription gel used to treat a variety of autoimmune and inflammatory disorders.
The company said sales of H.P. Acthar gel surged to $140.3 million from $59.8 million a year earlier. The gel is prescribed to treat illnesses including the kidney condition nephrotic syndrome, multiple sclerosis, and infantile spasms, a type of seizure disorder that affects children.
Net income increased to $55.7 million, or 91 cents per share, from $22.9 million, or 35 cents per share, in the third quarter of 2011.
The results easily beat the estimates of analysts polled by FactSet, who predicted earnings of 75 cents per share on revenue of $129 million.
The company reported shipping 5,590 vials of Acthar during the third quarter, up 92 percent compared with 2,910 vials in the year-ago quarter.
President and CEO Don Bailey attributed the company's results to increased use of Acthar by patients covered by private and public health insurance.
"Health care providers are expanding their usage of Acthar as an FDA-approved treatment alternative for patients with idiopathic types of nephrotic syndrome, MS relapses and rheumatology related conditions. We also continue to support patients suffering from infantile spasms," Bailey said in a statement
Shares of Questcor plunged in September after health insurer Aetna Inc. said that it may stop covering all uses of Acthar except infantile spasms. It said there is not enough clinical evidence that Acthar is more effective than steroids in treating other conditions.
Aetna's announcement caused Wall Street to worry that other insurers will also reduce their coverage of Acthar, hurting Questcor's revenue. Aetna is reviewing its policy on Acthar and is expected to make a final decision in October. Questcor, based in Anaheim, Calif., says that doctors most often prescribe Acthar for patients who haven't responded well enough to other therapies.
Questcor shares fell 33 cents to close at $25.93 in trading Tuesday.