Questcor Pharma Q4 Adj Profit Tops View, But Sales Miss

(RTTNews) - Biotechnology company Questcor Pharmaceuticals, Inc. (QCOR) reported Tuesday a profit for the fourth quarter that increased from last year, despite higher charges, reflecting strong double-digit sales growth amid expanded usage of blockbuster drug H.P. Acthar Gel. Adjusted earnings per share topped analysts' expectations by a penny, while quarterly revenues missed their estimates by a whisker.

Questcor said in early February that it appointed Rajesh Asarpota as its new chief financial officer, effective February 17. He succeeded Michael Mulroy, who was promoted to executive vice president of strategic affairs and general counsel, to spend increased time on evaluating potential strategic transactions to enhance shareholder value.

The Anaheimm, California-based company reported net income of $89.98 million or $1.44 per share for the fourth quarter, higher than $61.94 million or $1.03 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter totaled $103.70 million or $1.67 per share, compared to $65.71 million or $1.09 per share in the year-ago quarter.

On average, seven analysts polled by Thomson Reuters expected the company to report earnings of $1.66 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter surged 51 percent to $242.88 million from $160.53 million in the same quarter last year, but missed nine Wall Street analysts' consensus estimate of $244.15 million by a whisker. Specialty manufacturing subsidiary BioVectra contributed $12.6 million to total sales.

Net sales growth was primarily driven by the expanded usage of H.P. Acthar Gel (repository corticotropin injection) for patients primarily suffering from dermatomyositis, polymyositis, rheumatoid arthritis, and systemic lupus erythematosus.

Sales were also aided by the continued prescribing of Acthar by nephrologists in the treatment of proteinuria associated nephrotic syndrome (NS) and by neurologists in the treatment of multiple sclerosis (MS) relapses and infantile spasms (IS).

Questcor shipped 8,100 vials of Acthar during the quarter, up from 6,330 vials last year. The company added that vial shipments are subject to significant variation due to the size and timing of individual orders received from its distributor, which in turn affect net sales and net income.

New paid prescriptions for Acthar for the quarter increased about 30 percent to about 2,450 to 2,500. Rheumatology prescriptions now account for nearly 30 percent of total Acthar business.

There were also 1,345 to 1,355 new paid prescriptions for Multiple Sclerosis relapse patients, up about 9 percent year-over-year. New paid prescriptions for Infantile Spasms grew 3 percent to 180 to 185 from last year.

The company noted that it believes that insurance coverage for Acthar continues to remain favorable, when Acthar is prescribed for patients in need of an FDA-approved treatment alternative. The product label for Acthar currently includes 19 FDA-approved indications.

"In 2013, Acthar net sales grew in all therapeutic areas, with the biggest growth occurring in rheumatology. At the same time, the body of evidence related to Acthar expanded from investments in multiple company-sponsored clinical and non-clinical studies, as well as our ongoing support for investigator-initiated studies," President and CEO Don Bailey said in a statement.

For fiscal 2013, the company reported net income of $292.61 million or $4.76 per share, higher than $197.68 million or $3.14 per share in the prior year. Excluding items, adjusted earnings for the year totaled $336.51 million or $5.48 per share, compared to $209.64 million or $3.33 per share in the year ago.

Net sales for the full year surged 57 percent to $798.93 million from $509.29 million in the previous year. Adjusted net sales was $510.4 million.

Analysts expected the company to report full-year 2013 earnings of $5.47 per share on annual revenues of 794.68 billion.

"As we turn to 2014, our highest priority is to continue our commercial momentum, while further building the body of scientific evidence for Acthar and actively exploring various strategic alternatives," Bailey added.

QCOR closed Tuesday's regular trading session at $78.65, down $0.81 or 1.02% on a volume of 3.15 million shares. The stock lost a further $3.40 or 4.32% in after-hours trading.