Sucampo Upgraded to Strong Buy - Analyst Blog

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On Jan 6, 2014, Zacks Investment Research upgraded Sucampo Pharmaceuticals Inc. ( SCMP ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Sucampo raised its earnings per share projection for 2013 to 7-12 cents from the previous guidance of reaching break even. However, its earnings guidance for 2014 - to remain profitable - was reiterated.

On Dec 17, 2013, Sucampo commenced a global, pivotal, phase III program for Amitiza in pediatric functional constipation. The phase III program comprises two similarly designed, well-controlled, pivotal studies. The first part of the study, which has already begun, is a randomized, placebo-controlled, double-blind study evaluating the efficacy, safety and pharmacokinetics of Amitiza in pediatric patients aged 6 to 17 years. The other part will evaluate Amitiza liquid formulation in patients aged 6 months to below 6 years.

Recently, Sucampo reported data from a phase IIa proof-of-concept study for the evaluation of an intravenously administered compound from the company's ion channel activator program in lumbar spinal stenosis (LSS) patients. Data from the study revealed that patients receiving the ion channel activator experienced a statistically significant improvement in pain as compared to placebo. The study also showed improvements (though not statistically significant) in the primary and other efficacy measures, including pain associated with quality of life measures for patients treated with the ion channel activator. In this study the ion channel activator was well tolerated. On the basis of the findings from this study, Sucampo intends to initiate an additional phase IIa study in 2014 to identify the apt endpoints and dosing regimen for the compound.

The current Zacks Consensus Estimate of 10 cents for 2013 is within the guidance range provided by Sucampo. For 2014, the Zacks Consensus Estimate is 39 cents per share. Based on the positive developments, Sucampo was upgraded to Strong Buy.

Other Stocks to Consider

Other players in the pharma industry, which look attractive at current levels, include Lannett Company, Inc. ( LCI ), WuXiPharmaTech (Cayman) Inc. ( WX ) and Nektar Therapeutics ( NKTR ). All three stocks carry a Zacks Rank #1 (Strong Buy).

LANNETT INC (LCI): Free Stock Analysis Report

NEKTAR THERAP (NKTR): Free Stock Analysis Report

SUCAMPO PHARMAC (SCMP): Free Stock Analysis Report

WUXI PHARMATECH (WX): 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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