Questcor in Cover-Up Mode: Deleting Evidence from its Website … BUT Citron Finds the Smoking Gun and Presents it Here for the Federal Trade Commission. Investors please don’t read further — you might find something you don’t like.
Over the coming months, Citron Research will release a series of articles on Questcor (NASDAQ:QCOR) intended to shed light on probable issues of interest to the multi-pronged investigation underway by multiple regulatory agencies into numerous aspects of Questcor’s business strategy that political correct-speak would deem “legally challenged”. These articles will dig deeper into topics such as:
· The Chronic Disease Fund, and the role it plays in contributing to Questcor’s revenues
· Medicare billing (it is very dangerous to participate in a scheme to defraud the Federal Government)
· Insurance reimbursement coding for Acthar
Meanwhile, today’s question is whether Questcor’s Synacthen acquisition is anti-competitive. The points raised in Citron’s article last week are relevant to the FTC’s inquiry, demonstrating Questcor’s intent to suppress competition by acquiring Synacthen is exposed by their own sell-side analysts.
We are sure that Questcor will now try to posture to the FTC that Synacthen is a completely different drug, arguing that while it has similarities, it cannot be regarded as a replacement for HP Acthar Gel. This piece of evidence presented below is for the FTC, so shareholders please cover your eyes.
( Citron as always recommends downloading the PDF for local viewing, and clicking on the links.)
Analysts Comments tell you Everything You (and FTC investigators) Need to Know
On June 11, Questcor (NASDAQ:QCOR) surprised the investment community with news that it had acquired rights to Synacthen for the United States and up to 40 countries from Novartis. Within weeks the stock had doubled on that news, adding 1.75 billion in market cap. Why?
Simple. Synacthen is a synthetic version of ACTH, the sole labeled active ingredient in Acthar, which is Questcor’s only source of revenue. Synacthen has been prescribed in Europe for well over a decade for the same general spectrum of indications that Acthar is labeled for in the US – but at 1/1000th the price.
So when Questcor, which previously had no pipeline, no investigational efforts, and no significant double-blind studies proving efficacy of Acthar vs Synacthen, acquired these rights, the analyst community went all giddy – fawning all over how this move protected Questcor’s barrier to competition with regard to the pricing of Acthar. Questcor postured the deal as if they bought Synacthen just because they wanted to acquire a new drug, but anyone with half a brain knew that was bullshit.
And thank God the FTC has more than half a brain … sorry, Questcor.