Orange County Business Journal

Questcor’s Optimism Confirmed on Sales of MS Drug

Core Use Makes Headway With Doctors, More Seen Vita Reed Sunday, May 8, 2011

Anaheim’s Questcor Pharmaceuticals Inc.’s optimistic prediction for its first quarter came true late last month—and investors responded.

The drug maker said it earned $11.2 million for the quarter, up 42% from $7.9 million a year earlier.

Analysts looked for Questcor to have a profit of $10.4 million.

Revenue rose 40% to $36.8 million.

Wall Street expected $36.4 million in revenue.

The company’s shares rose 13% on news of the results late last month.

Questcor moved here from the Bay Area last year. The company makes H.P. Acthar Gel, an injectable drug primarily used to treat multiple sclerosis flare-ups. It’s also approved for treating infantile spasms, a rare form of epilepsy and nephrotic syndrome.

Questcor said its sales growth was fueled by a 120% rise in prescriptions for Acthar for its core use on MS flare-ups, with 508 during the first quarter.

The gain followed additions to the company’s sales force, said Steve Cartt, executive vice president and chief business officer.

“We believe the increased physician call activity, as well as further productivity gains by our sales personnel will drive continued MS sales growth throughout 2011,” he said.

Acthar originally was approved in 1952 by the Food and Drug Administration.

Questcor has said it has no plans to expand beyond Acthar, which it bought in 2001 from what’s now France’s Sanofi-Aventis SA.

Chief Executive Don Bailey has said there’s plenty of potential to expand Acthar’s sales for current and future uses.

“Why go looking for another meal—we’ve got plenty right in front of us,” Bailey said.

Endologix Steady

Irvine-based medical device maker Endologix Inc. is “holding steady” in the face of the introduction of a competing product from Medtronic Inc., according to an analyst.

The company posted a net loss of $4.8 million compared to $225,000 in red ink a year ago. Wall Street expected a loss of $3.4 million.

Endologix revenue came in at $18.5 million, up 28% from the first quarter 2010. Analysts had expected revenue of $18 million.

Sean Lavin of New York-based Lazard Capital Markets said Endologix—which makes stents to reinforce ruptured or ballooning arteries—held up well considering a bigger company introduced a competing product in the first quarter.

Minnesota-based Medtronic debuted its Endurant stent late last year. The company is one of the biggest in the medical device industry and employs about 700 workers in Irvine and Santa Ana.

Lavin said he expects Endologix to “over time, take share and continue to outgrow” its market despite Medtronic’s new product.

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