Stomach Cramps for Sucampo

Sucampo Pharmaceuticals (SCMP) said on Friday that the International Court of Arbitration, International Chamber of Commerce (ICC) did not agree with its claims against partner, Takeda (TKPHF), for under-promoting its lead product, Amitiza. The decision confirms that the Collaboration Agreement between the companies for Amitiza will remain in force until it expires in October 2020, including the royalty rate arrangement. Royalty revenue to Sucampo for Amitiza was $41.5 million in 2011 and $10.9 million in the first quarter of 2012.

Amitiza is approved for the treatment of chronic idiopathic constipation (CIC) and for irritable bowel syndrome with constipation (IBS-C) in adult women. Currently, Amitiza is the only FDA-approved medicine for either of these indications, however, the FDA is set to decide on the approval of linaclotide (Forest Labs (FRX) and Ironwood Pharmaceuticals (IRWD)) in September, which many expect to become stiff competition for Sucampo’s Amitiza. SCMP is likely to remain under pressure into the linclotide PDUFA date, and if approved, SCMP shares could trade back down to their lows.

Also, Synergy Pharmaceuticals (SGYP) is expected to report top-line results from an 880-patient Phase II/III trial of plecanatide for Chronic Idiopathic Constipation (CIC). The experimental drug has seen strong data to-date; further validation may narrow the valuation gap with Ironwood Pharma.