Sucampo Re-Embraces Amitiza Through Co-Promote Option After Rescula Falters

While the company had been hopeful about diversifying its revenue base with the launch of its glaucoma drug Rescula, those hopes have faltered and pushed Sucampo to try to maximize the potential behind its main sales-driver, the constipation treatment Amitiza.

With sales of its second product, Rescula, not living up to expectations, Sucampo Pharmaceuticals Inc. has decided to reorganize its commercialization efforts to emphasize its earlier product, Amitiza.

The Bethesda, Md.-based specialty pharma announced during its third quarter conference call Nov. 5 that it has plans to abandon its recently-hired sales force of 40 reps and the promotion of the glaucoma treatment Rescula (unoprostone) in favor of outsourcing to a contracted sales reps, while pushing the majority of its resources toward the constipation treatment Amitiza (lubiprostone) (Also see "Sucampo Puts 40 Reps Behind Rescula Launch As it Seeks Revitalization" - Pink Sheet, 26 Feb, 2013.).

FDA approved Rescula in December 2012 for the treatment of open-angle glaucoma and ocular hypertension. Sucampo built up a sales force to launch the drug in February 2013, but plans to gain 11% of the 5 million to 8 million patients with open-angle glaucoma did not work out. Sales of the drug since its launch have yet to reach $500,000.

“During our second-quarter earnings call we discussed the fact that our early uptake curve has not met our initial expectations. And this quarter, while we saw growth in RESCULA prescriptions, total prescriptions continued to not meet our expectations,” Sucampo president Stan Miele said during the Nov. 5 call.

While the company says it is not abandoning the product altogether, it is no longer going to make personal calls to physicians who have not yet prescribed the drug and is going to shift its efforts to contacting those physicians via phone and digital efforts only. The current in-house sales reps promoting the drug will be eliminated in “an effort to better match investment with revenue.” A contract sales organization being hired to promote Amitiza will devote 20% of its time to promotion of Rescula to current prescribers. The company intends to reduce the resources it devotes to Rescula by 75% by 2014.

Opening Up Amitiza’s Potential

While Rescula was important to the company because it further validated the prostone technology that Sucampo discovered and gave it a product that is wholly-owned, the real near-term value driver for Sucampo remains Amitiza. The constipation drug, which has a long patent life (the patent expires in 2027), has been used for more than seven years and has been prescribed more than 7 million times.

Sales of Amitiza in the U.S. reached $204 million for the first nine months of 2013, according to Sucampo’s commercialization partner Takeda Pharmaceutical Co. Ltd. Sucampo receives a royalty on all net sales of the drug in the U.S. at a rate of 18% to 26% (the company does not disclose at what levels the rate tiers up).

Sucampo has long been dissatisfied with the Japanese pharma’s promotion of the drug – until recently, Takeda was promoting Amitiza only to office-based specialty physicians and a select number of primary care physicians. Sucampo claimed that Amitiza has low awareness among patients, primary-care physicians and gastroenterology specialists due to a lack of effort by Takeda. Unfortunately for Sucampo, arbitration of the matter ended in Takeda’s favor.

Circumstances regarding this partnership changed for Sucampo recently when FDA approved Amitiza for its third indication: opioid-induced constipation. The approval triggered a $10 million milestone payment from Takeda and pushed Sucampo to exercise its co-promotion right. Sucampo CFO Cary Claiborne called the approval in an interview “the big driver” behind the company revamping its commercialization efforts. Amitiza gained the new indication in April, adding to its previous indications of chronic idiopathic constipation in adults and irritable bowel syndrome with constipation in adult women.

The specialty pharma will hire a sales force of 36 to 40 reps through a contract sales organization – Sucampo employees will hold managerial roles – that is expected to begin promoting the new indication in the first quarter of 2014. Claiborne noted that contracting the work “was a better use of our capital” and allowed the company to have better access in certain geographies. Sucampo will be in charge of reaching out to pain specialists and rheumatologists.

Takeda will increase its sales efforts by 25%, allowing it to reach about 10,000 more physicians, and will continue to focus on primary care physicians. The firm doesn’t disclose how its sales reps are distributed, but it currently has about 1,800 reps in the U.S.

Sucampo is currently partnered with Abbott Laboratories Inc. on Amitiza in Japan, and Claiborne said the company “is very pleased with how that relationship is going so far.” Unlike its partnership with Takeda, Sucampo sells the drug to Abbott wholesale instead of receiving royalties on the product. So far, sales in Japan have grown 58% since the second quarter, with Sucampo reporting $5.2 million in revenues from the product.

The company continues to look for other partners for Amitiza in other areas of the world, including Europe and the emerging markets. Claiborne said the company hopes to find a partnership that allows Sucampo a significant amount of control over how the product is sold and priced. He also noted that a smaller company with a strong infrastructure and knowledge of a specific locale may be a better fit than a larger multi-national player.