Bloomberg News

Questcor Plunges as Citron Research Says MS Gel Lacks Ingredient

February 28, 2014

Questcor Pharmaceuticals Inc. (QCOR:US) declined for a second straight day after a research report said that the company’s multiple sclerosis treatment didn’t contain any of its active ingredient.

The shares of the Anaheim, California-based company fell (QCOR:US) 7.7 percent to $62.27 at 1:45 p.m. New York time, after tumbling 9.1 percent yesterday, the biggest single-day loss in about four months.

Citron Research, a stock commentary website, said yesterday that two batches of Questcor’s top-selling H.P. Acthar gel, marketed for multiple sclerosis and other difficult-to-treat autoimmune and inflammatory disorders, were tested at two laboratories and found to have “little to no” corticotropin, the active ingredient, and warned that the medicine faced a “severe risk of being pulled off the market by the FDA.”

Citron declined to name the labs involved because of continuing testing, and said that more batches of Acthar were being analyzed. It submitted a report to the Food and Drug Administration, which said the lab findings “raise important regulatory concerns about the identity, purity and stability of Questcor’s drug product that warrant an FDA investigation.”

The FDA is reviewing the lab results, Sandy Walsh, an agency spokeswoman, said yesterday in an e-mail.

“Acthar is a naturally-derived, complex peptide formulation that is not yet fully understood,” Steve Cartt, Questcor’s chief operating officer, said in an e-mail yesterday. “Each Acthar lot meets FDA-mandated specifications which have not changed over several decades.”

Steve Byrne, a Bank of America analyst, defended Acthar in a note to clients today, saying “this alleged risk is remote.”

“ACTH is one of many pituitary derived peptides in Acthar, and thus would likely represent a small fraction of the peptide mass,” Byrne said.

Acthar is Questcor’s best-selling drug, contributing 95 percent of the company’s $798.9 million in net sales for 2013, according to a regulatory filing. It is approved for 19 uses and costs about $28,000 a vial, the company said.

To contact the reporters on this story: Caroline Chen in New York at; Catherine Larkin in Chicago at

To contact the editor responsible for this story: Reg Gale at

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