Questcor Pharmaceuticals Inc., a growing maker of a drug to treat multiple sclerosis and a rare form of epilepsy, has moved its headquarters from Northern California to Anaheim Hills.
The publicly traded company, which had a market value of $630 million last week, moved its base here to be closer to Chief Executive Don Bailey, who lives in Yorba Linda.
The move was driven “by my (desire) to reduce my commute,” Bailey said.
Questcor now has its headquarters in temporary offices near Weir Canyon Road and the Riverside (91) Freeway.
In January, the company plans to move to about 4,500 square feet of permanent space nearby at La Palma and Imperial Highway, according to Bailey.
Operations
About a dozen Questcor employees are set to be based in Anaheim. The company is keeping marketing operations at its old headquarters in the East Bay’s Union City as well as a research site in Baltimore.
Questcor uses contract manufacturers to produce its drugs.
The company employs about 130 people. Most are field sales representatives.
While Questcor isn’t bringing a big operation to Anaheim, the move of its headquarters adds a drug maker with $120 million in yearly sales to the ranks of the industry here.
Irvine-based Allergan Inc. is the county’s largest drug maker here with yearly sales of nearly $5 billion, 2,000 local employees and a recent market value of $22 billion, the most of any company here.
Irvine-based Anchen Pharmaceuticals Inc., a privately held maker of generic drugs, is estimated to be the second-largest drug maker based in the county with an estimated 300 workers here.
The county recently lost its No. 3 drug maker, Aliso Viejo’s Valeant Pharmaceuticals International, which was acquired earlier this month by Canada’s Biovail Corp.
With Valeant’s departure, Questcor likely is the third-largest drug maker based in the county by sales. It leapfrogs several other smaller drug makers here including Spectrum Pharmaceuticals Inc. of Irvine and Peregrine Pharmaceuticals Inc. of Tustin.
Earlier this month, Questcor received Food and Drug Administration approval for use of its primary drug, H.P. Acthar Gel, to treat a rare, potentially fatal form of epilepsy called infantile spasms. The condition impacts some 2,000 infants annually.
Acthar is an injectable gel first approved by the FDA in 1952 for several conditions. Questcor acquired the drug in 2001 from what’s now Sanofi-Aventis SA.
Acthar, which is made from the pituitary glands of pigs, first was owned by Armour Pharmaceuticals, a drug unit of Chicago meatpacking company Armour and Co.
Questcor primarily markets Acthar for treating relapses of multiple sclerosis, a neuromuscular disease that gradually causes the loss of various physical functions.
Acthar also is approved for a condition called nephrotic syndrome, a disorder under which large amounts of protein are leaked into urine by damaged kidneys.
The multiple sclerosis and nephrotic syndrome markets are estimated at around $500 million yearly, according to Bailey.
Rivals include Pfizer Inc.’s Solu-Medrol, a steroid, and generic versions of Solu-Medrol.
Before its approval for infantile spasms, Acthar widely was used by doctors to treat the condition in what’s known as off-label use. Once a drug has been approved for any use, doctors can prescribe it for other conditions as they see fit.
The use prompted Questcor to seek approval of Acthar as an infantile spasms drug.
Regulators quashed Questcor’s bid to gain infantile spasms use for Acthar in 2006 because the drug maker didn’t provide enough scientific information, according to Bailey.
Acthar is one of two FDA-approved drugs for treating infantile spasms. The other, Sabril, is sold by H. Lundbeck AS of Denmark.
No other competition is expected, analyst Yale Jen of New York-based Maxim Group LLC told Reuters earlier this month.
Questcor received a seven-year exclusivity period to market Acthar for infantile spasms.
Stock Run-Up
The company’s seen a big run-up on Wall Street this year. Since January, Questcor’s shares are up about 120%.
Rising profits and sales and the prospect of more market share appear to be behind the gain.
Questcor is set to report its third-quarter results on Thursday.
On average, analysts expect the drug maker to post a profit of $9.3 million, up 650% from a year earlier. Sales are seen coming in at $30.4 million, more than double a year earlier.
The company has a relatively low Wall Street profile. Only three brokerages follow Questcor.
“I’ve been told if the stock stays over $10, we’ll eventually attract some other research analysts,” Bailey said.
Questcor’s shares were trading at about $10 last week.
Bailey’s history with Questcor goes back to 2006, when he joined as a director. He took on the chief executive’s role later that year, despite not having a drug industry background.
His career includes serving as chief executive of Comarco Inc., a Lake Forest-based electronics maker, from 1990 to 2000.
“The stock went up about 20 times when I was there,” Bailey said.
Bailey’s joined in Anaheim by Questcor’s financial team. The company currently is looking for a chief financial officer.
Gary Sawka, who was chief financial officer, now is in a part-time role. n
