While this may seem like a blow to the chest for those still holding positions (which was strongly recommended against in my earlier post), it may be an opportunity to ride the waves again before the new September PDUFA. Why is this? Well, reading QCOR's press release closely, one is able to discern positive sentiment behind the approval delay, which, according to the agency, was to allow more time for them "to review information regarding labeling and potential post-approval commitments that they solicited from Questcor". Judging from this, it seems like a matter of time before Acthar Gel gets cleared by the FDA, an ultimate hope for young patients, doctors, and stakeholders.
My prediction is that the price will come down from its peak, as already happening after the news on Friday, to around $7-8, at which point it would be a great point of entry for another climb before the September 11 PDUFA. Again, like I suggested before, upon approval, the shares will likely be pushed up to $12-14. Nevertheless, since QCOR only published the FDA's response late Friday afternoon, we will have to gauge the direction as well as the magnitude of QCOR's stock movement and the state of the market as whole in order to make further decisions on the next steps. Hang on tight! We may be in for another fun ride with Questcor!
Great analysis of Acthar - thanks!
ReplyDeleteYou may be interested in this analysis of its application to the FDA which highlights the concerns with it - http://healthlifeandstuff.com/2010/06/analysis-probability-of-acthar-approval/
Thank you, David. I appreciate the site included in your comment. It provides a different perspective for sure. As with all types of investment, there are inherent risks to banking on Acthar's approval (whether or not the risk is 25%, it's hard to say).
ReplyDeleteI have a few comments to the article you pointed to:
1) “The vote in favor of Acthar could possibly be largely based off the existing use of Acthar as a treatment for IS. Panelists may have felt it would be wrong to vote against a drug for a use they were using it” – I disagree with this remark. Acthar has been agreed upon as the first-in-line treatment for IS and has been clinically prescribed to numerous young patients. The FDA and its advisory panel would not hesitate for a second to refuse commercialization the drug if benefits of Acthar do not outweigh its risks, especially considering the lives of very young kids. Surely, all but one panelist voted for the drugs approval, but certainly not because ‘it would be wrong to vote against it’ but because the drug has demonstrated efficacy for IS treatment.
2) “The drug application for Acthar’s approval contains multiple issues relating to the collection of data and various irregularities” – I’d like to comment on this statement. The limited clinical data provided to the FDA was partly due to the class of application called sNDA (supplemental New Drug Application), which is intended for companies to gain marketing clearance of a previously approved drug for a new disease indication. Naturally, being supplementary, the extensiveness of data supplied would not match that required by a regular NDA and may thus be seem ‘irregular’ in comparison to data submitted in a NDA for a novel drug. That said, the FDA never compromises on the level of standard for any types of NDA, and Questcor has definitely met that stringent requirements in this regard based on the absence of an outright rejection or specific requests to address this issue.
3) “[The studies performed] were academic studies and not the clinical research studies typically used in drug applications – this means that the data from them was not collected normally and is “likely to be incomplete” – this statement requires clarification. Does it mean that the data provided were generated entirely from basic research (= “academic research and not clinical research”)? This is simply impossible.
All in all, I would argue that the continuing practice of physicians to prescribe Acthar Gel to children suffering IS is an indirect evidence of the drug’s efficacy.
These are just some of my thoughts. For the benefits of suffering children, I hope the company will eventually receive the approval. Cheers!