Shares of Questcor Pharmaceuticals Inc QCOR.O rose as much as 26 percent to a life-high on Wednesday, after strong sales growth for Acthar allayed concerns that reimbursement issues would restrict sales for newer uses of the drug.
The company said on Tuesday that it shipped 7,050 vials of Acthar, an almost 46 percent jump from the first quarter. The drug is approved to treat multiple disorders including infantile spasms and multiple sclerosis.
"Questcor reported a very solid (second quarter), that hopefully, has put to rest any lingering concerns regarding Acthar reimbursement," Lazard Capital Markets analyst Joshua Schimmer wrote in a note.
Questcor first faced reimbursement issues after insurer Aetna Inc (AET.N) said Acthar was medically necessary only to treat infantile spasms and the drug was no better than existing therapies in the 18 other diseases that it was approved to treat.
The company also said Tuesday that it resolved distribution issues that it said were behind weak sales in the first quarter.
Questcor said it generated over 300 prescriptions for Acthar in rheumatology in the second quarter, after expanding its marketing targeted at these disorders earlier this year.
"Acthar performance in rheumatology is exceeding our expectations and we believe future performance is likely to be solid," Ladenburg Thalmann analyst Juan Sanchez said.
The drug's rheumatology indications include psoriatic arthritis, rheumatoid arthritis, juvenile rheumatoid arthritis, and ankylosing spondylitis.
Anaheim Hills, California-based Questcor shares touched a life-high of $65.45, before easing slightly to $65.25 in morning trade on the Nasdaq.
(Reporting by Pallavi Ail in Bangalore; Editing by Sriraj Kalluvila)