Sucampo Pharmaceuticals Launches Rescula In The U.S.

Sucampo’s (SCMP) launch of glaucoma drug Rescula onto the US market is its first self-commercialisation effort. Careful product positioning and a targeted commercial campaign, emphasising Rescula’s novel mode of action, should give the drug a competitive foothold in a highly competitive market. The wholesale acquisition cost (WAC) of $99 per script (30-day eye drop supply) is on a par with some branded prostaglandins (Zioptan) and is higher than our previous price assumption. We raise our peak US sales estimate for Rescula to $90m (previously $65m) and increase our valuation of Sucampo to $335m or $8.00 per share (vs $315m, $7.52 per share).

Still room in the market
Prostaglandin analogues – Xalatan (now generic), Lumigan, Travatan – are once-daily eye drops used most commonly as the first line of therapy for lowering intraocular pressure (IOP) in patients with open-angle glaucoma or ocular hypertension. However, tolerability, particularly hyperaemia (red eye), is an issue with prostaglandins, leaving a decent portion (c 50%) of the glaucoma market for alternatives, currently occupied by beta-blockers, alpha agonists and carbonic anhydrase inhibitors (CAIs).

Positioning and label is key
Rescula, with its prostone-based, ion channel (BK and ClC-2) activating technology, offers an alternative mechanism of action to prostaglandins and the key second-line therapies. Although Rescula can be used as a first-line agent, Sucampo will primarily focus on positioning the drug as a safe and more convenient second-line option for patients intolerant, or failing to respond, to prostaglandins.

Better chance this time
Rescula, a twice-daily eye drop, was approved by the FDA in 2000 and marketed in the US (2000-2002) by previous licensee Ciba Vision, but uptake was restricted by its classification as a prostaglandin, bracketed as a ‘me too’ to the fast-growing brands. The recent FDA approval of Rescula’s revised label, not classified as a prostaglandin, was vital, and clearer positioning of the product, supported by 40 reps directly targeting 50% of specialist prescribers, gives Rescula a stronger competitive position.

Valuation: Increased to $335m, $8.00 per share
We increase our valuation of Sucampo to $335m (vs $315m) or $8.00 per share ($7.52), mainly as a result of raising our peak US sales estimate for Rescula to $90m (vs $65m) – Rescula now contributes $110m, or $2.62 per share, to our total DCF-based valuation. We note that peak sales could be considerably higher (up to $150m), but await prescription trends, especially beyond the initial phase of heavy sampling.

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