In addition, Questcor Pharmaceuticals Inc (NASDAQ:QCOR) is active in adding more conditions to the label of the drug. Recently, the company started phase 2 trials for amyotrophic lateral sclerosis — a progressive, degenerative disease that significantly alters one’s quality of life. According to the ALS Association, the average life expectancy from the time of diagnosis for someone affected by this disorder is about two to five years. If the company is successful in adding this condition to the label; it will further enhance the portfolio of the company and provide future growth avenue.
The company recently announced its second-quarter results, which substantiates the optimism about the future growth of the business. Its recent quarter earnings per share increased by 96% amounting to $1.35 compared to the same time last year. Furthermore, vial shipments have gone up by 50% compared to the same quarter last year.
Other players working on orphan drugs
There are a number of companies working on orphan drug development — the orphan drug act was passed in 1983 to encourage companies to develop drugs for rare diseases that affect less than 200,000 Americans. Under the act, companies are offered tax credit, seven years marketing exclusivity and special pricing to cover the development costs.
Summary
Questcor is still undervalued, in my opinion. I expect the growth to continue over the next three to five years. As a result, the stock will be trading substantially higher than the current levels. The only concern for Questcor is another regulatory probe into the dealings of the company. If the company is able to deal with this risk then I do not see any other pitfall for Questcor in the near future.
The article Is Questcor Still Undervalued? originally appeared on Fool.com is written by Ishtiaq Ahmed.
Ishtiaq Ahmed has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.
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