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Questcor Pharmaceuticals (QSC) |
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WIKI ANALYSIS
Questcor Pharmaceuticals (NYSE: QSC) is a biotechnology company specializing in therapies for difficult to treat diseases such as multiple sclerosis (MS) and lupus. Questcor is largely focused on the commercialization of a single product Acthar, which Questcor acquired from Sanofi-Aventis SA (SNY) in 2001,[1] to treat MS and kidney disease as well as several other indications. Questcor does not have an active pipeline for developing other products, but is actively pursuing additional indications to expand the use of Acthar.
The success of Questcor as a company is strongly tied to the success of Athcar in growing sales within its indicated markets. The ability of Questcor to penetrate its indicated markets and develop new markets will impact Questcor's long-term success.
Business Growth
FY 2010 (ended December 31, 2010)[2]
- Net revenue increased 30% to $115 million.
- Net income increased 32% to $35 million.
In 2010, revenue growth was driven by increased sales of Questcor's flagship product, Acthar, which received approval for a new market treating infantile spasms in October of 2010.[3] Questcor also expanded its sales force in order to further drive demand for Acthar.[4]
Trends and Forces
Acthar Sales Growth Will Define Questcor's Success
The vast bulk of Questcor's revenue comes from the sale of Acthar, which generated $114 million in sales in 2010. The combined market opportunity for Acthar is $1.5 billion. Questcor estimates that Acthar can build on markets of $500 million in MS, $100 million for infantile spasms, and over $1 billion for kidney disease. Questcor plans to capitalize on these opportunities by adding sales representatives for kidney disease, maintaining and growing its presence in the infantile spasms group, and growing indications.[5] Questcor's success in driving Actar sales will be strongly tied to its overall success as a business.
New Indications for Acthar Will Expand Revenue Potential
Acthar's main market is the treatment of MS flare-ups, but the drug is also indicated to treat kidney disease, infantile spasms, and epilepsy - 19 conditions in total. According to CEO Don Bailey, Questcor's strategy is to "grow sales in each of these [current] markets and then add other markets.”[6] While Questcor is a company focused almost entirely on a single product, Acthar, its ability to differentiate this product and diversify across several markets will strengthen its sustainability in the long-term.
Competition
- Steroids: Acthar's main sales driver is its success in the MS market. However, many of the symptoms that it treats in this market are currently treated using generic steroid medications. In fact, in head to head studies, there were no differences in benefit between Acthar and intravenous steroid therapy. However, Acthar can add benefit when patients cannot be adequately treated with steroid therapy.[7]
- Lundbeck: Sabril was approved in 2009 to treat infantile spasms and is a competitor in this market against Acthar.[8]
- Marinus Pharmaceuticals: Is developing Ganaxolone, a neurological therapy that could eventually compete with Questcor in the infantile spasms market.
References
- ↑ Three Problems with Questcor’s Acthar IS Approval
- ↑ QSC 2011 10K
- ↑ FDA Approves H.P. Acthar® Gel for the Treatment of Infantile Spasms
- ↑ Questcor Reports Record Second Quarter Net Sales
- ↑ Questcor Investors Presentation
- ↑ Questcor Eyes More Conditions for Core Drug Acthar
- ↑ Acthar Homepage
- ↑ Vigabatrin (Sabril) Approved by FDA
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