Questcor Pharmaceuticals Inc said it is now eligible to provide lower Medicaid rebates on its flagship multiple sclerosis drug, Acthar Gel, allowing for improved financial results in the future.
The company said the government informed it that Acthar is now eligible for lower rebates for patients under Medicaid -- the program that funds medical and health-related services for the poor and disabled.
In a filing, Questcor said it estimates the rebate rate to be cut from about 100 percent of the amount it charges its distributor to 23.1 percent, and that the cut could be materially positive to its financial results.
Acthar, the only drug Questcor sells, has been approved to treat a range of disorders including multiple sclerosis, rheumatic disorders, allergies, seizures in babies, a kidney condition called nephrotic syndrome, and eye and respiratory diseases.
Shares of the Anaheim Hills, California-based company, were trading up 10 percent at $47.50 before the bell.
(Vidya P L Nathan in Bangalore, Editing by Anthony Kurian)