Jefferies Says Questcor's Acquisition of Synacthen Rights Should Soothe Investor Fears

Jefferies analyst Biren Amin commented on Questcor's

purchase of Synacthen in a note published Tuesday morning. Amin believes the deal has the potential to remove a competitive threat moving forward. Investors in Questcor shares are reacting extremely positively to news of the acquisition; shares of QCOR are up more than 21 percent to over $44.60 at last check. The company paid Novartis

$60 million upfront under the terms of the agreements. Additional payments of at least $75 million will be paid over the next several years. Amin suggested the purchase of Synacthen's rights remove a major overhang from shares of Questcor. The analyst noted trials from Synacthen and Synacthen Depot in rheumatology, multiple sclerosis, IS and NS will need to demonstrate solid efficacy and safety within the US for those indications to be given. The Jefferies analyst maintains a Buy rating and $38 price target on shares of Questcor. With short interest for QCOR shares around 32 percent of float, a small portion of Tuesday's sharp move higher could be related to short covering.