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Sucampo (SCMP) Misses on Q3 Earnings, Focus on Amitiza

Sucampo Pharmaceuticals SCMP reported earnings of 16 cents per share in the third quarter of 2015, missing the Zacks Consensus Estimate of 18 cents per share. It reported earnings of 14 cents in the year-ago quarter.

Total revenue was $33.4 million, up 6.3% from the year-ago quarter but below the Zacks Consensus Estimate of $36 million.

The Quarter in Detail

Revenues were primarily driven by Amitiza's continued growth in the U.S. and Japan.

Product royalty revenues were up 15% to $19.3 million. Product sales were down 6% to $11 million.

Amitiza U.S. sales, as reported by Takeda Pharmaceutical Company Ltd. TKPYY for royalty calculation purposes, were $101.7 million, up 15% year over year. Total prescriptions for Amitiza in the U.S. were 379,000 up 10.4% year over year. Takeda expects to launch Amitiza in Canada in the first half of 2016.

Research & development expenses were $8.4 million in the reported quarter, up 58% from the year-ago quarter primarily due to the development of cobiprostone and Amitiza for pediatric functional constipation.

General & administrative expenses were $7.8 million, down 4.5% from the year-ago quarter due to lower legal fees following the settlement of the Par Pharma patent infringement lawsuit, partially offset by higher stock-based compensation expense.

Selling and marketing expenses decreased 90% to $0.4 million, reflecting a reduction in direct commercial activities in the fourth quarter of 2014 in the U.S. and Europe.

Pipeline Update

The Chinese FDA accepted an investigational new drug application for Amitiza for treatment of chronic idiopathic constipation (CIC).

Currently, Sucampo is enrolling patients in a pediatric functional constipation study on Amitiza in patients (aged between 6 years and 17 years) using the current formulation. Data should be out in the second half of 2016. An alternate formulation of Amitiza is under development both for adult and pediatric patients who cannot swallow or who have difficulty swallowing capsules of the currently approved drug.

The company intends to initiate a phase III study of the alternate formulation of Amitiza for adults suffering from CIC in the second half of 2016. A single pivotal study on the alternate formulation of Amitiza for children aged between 6 months and 6 years is expected to start in the first half of 2017.

Meanwhile, top-line data from the phase II study on cobiprostone for PPI-refractory non-erosive reflux disease/ symptomatic gastro-esophageal reflux disease should be out in the first half of 2016.

In September, Sucampo initiated a phase IIa study on cobiprostone for the prevention of oral mucositis in patients suffering from head and neck cancer shortly. Data are expected to be out by first half of 2017 Cobiprostone enjoys fast track status in the U.S. for the prevention of oral mucositis.

Maintains 2015 Guidance

Sucampo maintained its 2015 earnings of 65 - 75 cents per share.

For 2016, Sucampo expects earnings of $0.97 - $1.07 per share on revenues of $195 million - $205 million. Moreover, Sucampo expects pre-tax operational synergies of $11.4 million in 2016.

Our Take

Sucampo's third-quarter 2015 results were disappointing with the company missing on both the top- and bottom-line. However, we are encouraged by Amitiza's prescription growth. Meanwhile, the upcoming acquisition of R-Tech should boost revenues and earnings as well as the pipeline.

Sucampo carries a Zack Rank #3 (Hold). Some better-ranked stocks in the health care sector are Spectrum Pharmaceuticals, Inc. SPPI and Esperion Therapeutics, Inc. ESPR . Each carries a Zacks Rank #1 (Strong Buy).

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SUCAMPO PHARMAC (SCMP): Free Stock Analysis Report

SPECTRUM PHARMA (SPPI): Free Stock Analysis Report

TAKEDA PHARMACT (TKPYY): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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