In Apr 2014, Mallinckrodt and Questcor entered into a definitive merger agreement whereby Mallinckrodt would acquire Questcor for $5.6 billion. As per the terms of the agreement, shareholders of Questcor will receive $30.00 per share in cash and 0.897 Mallinckrodt shares for each share of Questcor common stock. The total consideration comes to $86.10 per Questcor share.The transaction, subject to customary closing conditions, is expected to be completed by the third quarter of 2014. The stock has had a fairly good run so far in 2014. With the closure of the acquisition scheduled for next quarter, we do not see any upside potential and hence downgrade our recommendation to Neutral.
Based in Calif., Questcor Pharmaceuticals (QCOR), a biopharmaceutical company, primarily focuses on treating patients suffering from serious autoimmune and inflammatory disorders in the fields of neurology, nephrology and rheumatology.
The lead product for Questcor is H.P Acthar Gel. Acthar, a repository corticotropin injection which is a naturally derived formulation of adrenocorticotropic hormones (ACTH) used in a variety of disorders having an inflammatory component. Acthar is approved in the U.S. for nineteen indications. Key indications among these include nephrotic syndrome, multiple sclerosis (MS) relapse, infantile spasms, and rheumatology indications.
In Jan 2013, Questcor acquired BioVectra Inc., thereby gaining control over the manufacturing and quality of the active pharmaceutical ingredient in Acthar.
Questcor's other approved product is Doral, which is indicated for the treatment of insomnia. Total sales for 2013 came in at $798.9 million, up 56.7% from a year ago.
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