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The Financial Performance of Sucampo Pharmaceuticals

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Revenue trends

Sucampo Pharmaceuticals (SCMP) generated revenues of $61.2 million in 3Q17 compared with $57 million in 3Q16. The increase was mainly attributable to the rapid uptake of Amitiza, which contributes most of the company’s revenues. Amitiza generated $33.6 million in sales in 3Q17, which was significantly higher than $29 million in 3Q16. The increase was due to an increase in Amitiza sales in Japan.

Sales of Rescula in Japan contributed $2.1 million, while royalty revenue on products for Takeda Pharmaceuticals (TKPYY) was $23 million in 3Q17.

Of the total revenues, $38.5 million was generated from the United States and ~$22.7 million came from Japan.

For fiscal 2017, Sucampo is expected to report revenues of $252.6 million. Peers Ironwood Pharmaceuticals (IRWD), Synergy Pharmaceuticals (SGYP), and Valeant Pharmaceuticals International (VRX) are expected to report revenues of $291 million, $14.8 million, and $8.7 billion, respectively, in 2017.

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Gross margins

Sucampo Pharmaceuticals’ gross margin for 3Q17 was 70% compared with 72% for 3Q16. The fall was due to higher sales of Amitiza in Japan where the company witnessed higher cost of goods sold as it absorbed packaging costs for the product.

For 3Q17, R&D (research and development) expenses were $10 million. That was flat compared with $9.9 million in 3Q16. According to Sucampo, the mix of R&D expenses has tilted toward VTS-270 and away from lubiprostone.

General and administrative expenses

For 3Q17, general and administrative expenses decreased 10% to $10 million compared with $11.1 million in 3Q16. The fall was due to lower legal costs. Selling and marketing expenses rose 260% to $2.5 million, from $0.7 million in 3Q16. The rise was due to activities related to VTS-270.

Sucampo makes up 0.03% of the iShares Russell 2000 Growth’s (IWO) total portfolio holdings.

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