Sucampo Pharmaceuticals, Inc. Reports First Quarter 2013 Financial and Operating Results

  Sucampo Pharmaceuticals, Inc. Reports First Quarter 2013 Financial and
  Operating Results

           Company to Host Conference Call Today at 5:00 pm Eastern

Business Wire

BETHESDA, Md. -- May 07, 2013

Sucampo Pharmaceuticals, Inc. (“Sucampo”) (NASDAQ: SCMP), a global
pharmaceutical company with products available in the United States (U.S.),
Japan and Europe, today reported its consolidated financial results for the
first quarter ended March 31, 2013.

Sucampo reported a net loss of $3.1 million, which includes a tax provision of
$1.1 million, or $0.08 per diluted share, for the first quarter of 2013
compared to a net loss of $1.9 million, or $0.05 per diluted share, for the
first quarter of 2012.

“2013 is off to a strong start for Sucampo,” said Ryuji Ueno, M.D., Ph.D.,
Ph.D., Chairman, Chief Executive Officer, and Chief Scientific Officer of
Sucampo. “I am very pleased that we have received approval of our sNDA for
opioid-induced constipation, the third indication for AMITIZA^®, ^ and we will
receive a $10 million milestone payment from our commercial partner in the
second quarter. This quarter we also launched RESCULA^® and completed
additional regulatory filings in Europe for AMITIZA, including filings for OIC
in the United Kingdom and Switzerland. We are very pleased with these
successes and are confident that we are on track to meet our upcoming
milestones over the rest of the year.”

Quarter Operational Highlights –

  *As previously reported, on April 23, 2013, Sucampo announced that the
    United States Food and Drug Administration (FDA) has approved Sucampo’s
    supplemental new drug application (sNDA) for AMITIZA (lubiprostone) (24
    mcg twice daily) as the first and only oral medication for the treatment
    of opioid-induced constipation (OIC) in adult patients with chronic,
    non-cancer pain. Upon the first sale of AMITIZA for OIC, we will recognize
    a $10.0 million milestone payment from Takeda, which we expect to receive
    in the second quarter of 2013.
  *In February 2013, Sucampo began commercialization of RESCULA (unoprostone
    isopropyl ophthalmic solution) 0.15% for the lowering of intraocular
    pressure (IOP) in patients with open-angle glaucoma or ocular
    hypertension. Early response to the positioning and messaging has been
    positive, and we anticipate prescriptions to steadily increase over the
    next few months as we work to pull through patient samples and expand
    managed care coverage.
  *In February 2013, Sucampo completed regulatory filings for an OIC
    indication in Switzerland, and in March 2013 we completed filing for the
    same indication in the U.K. When we receive approval for OIC in the U.K.,
    we will seek approval for OIC in other E.U. countries following the mutual
    recognition procedure (MRP).
  *In the first quarter of 2013, we began the MRP to seek approval for
    AMITIZA for CIC in additional European Union countries.
  *Also in the first quarter of 2013, we completed our phase 1a trial of an
    oral spray formulation of SPI-8811, or cobiprostone, for the prevention
    and/or treatment of oral mucositis. We expect the results in the second
    quarter of 2013.
  *Sucampo initiated a phase 2a trial of SPI-017 in the quarter for the
    intravenous treatment of pain associated with severe lumbar spinal
    stenosis, and we expect this trial to conclude in the fourth quarter of
    2013.
  *Progress continues in planning for our phase 3 program for AMITIZA in
    functional pediatric constipation.

As previously announced, in February 2013, R-Tech Ueno, Ltd. (R-Tech),
Sucampo’s development partner, signed an agreement for unoprostone isopropyl
with the Japan Science and Technology Agency in which the Japanese government
shall provide the majority of funding for phase 3 clinical development costs
for unoprostone isopropyl for retinitis pigmentosa (RP). In the first quarter
of 2013, R-Tech announced the enrollment of the first patient in this program.
Sucampo is co-developing unoprostone isopropyl with R-Tech and may file for
FDA approval of the product for RP in the future assuming successful trials.

2013 Value Drivers:

Sucampo is pursuing the following value drivers in 2013, of which we have
already achieved four in the first quarter:

AMITIZA

U.S.

  *Approval of the OIC indication for AMITIZA in the U.S., which has been
    achieved. Upon the first sale of AMITIZA for OIC, we will receive a $10.0
    million milestone payment from Takeda, which we anticipate will be in the
    second quarter of this year.
  *Achieve First Patient First Visit in our AMITIZA phase 3 trial for
    pediatric functional constipation in the second half of 2013.

Global

  *Pursue strategic alliances for AMITIZA for new indications and new
    territories outside of the U.S., including Europe and several Asian and
    emerging markets.

Japan

  *Continued growth of AMITIZA sales.

Europe

  *Submission for regulatory approval in the U.K. and Switzerland of AMITIZA
    for the treatment of OIC, which was completed in the first quarter of
    2013. We will continue to work with regulatory authorities to achieve
    approval. Once approved in the U.K., we will seek approval in other
    European markets for OIC using the mutual recognition procedure.
  *Seek endorsement from NICE for both CIC and OIC in the U.K., and make
    AMITIZA available for CIC with reimbursement by some local budget holders.
  *Begin active marketing of AMITIZA for CIC in Switzerland.
  *Submission of additional regulatory filings, using the MHRA approval, to
    seek expansion of AMITIZA’s CIC indication to other European markets via
    the MRP.

RESCULA

  *Launch of RESCULA in the U.S. Following the RESCULA sNDA approval, Sucampo
    launched the drug in the U.S.in February. RESCULA is now available in all
    major pharmacies, and we continue to see progress in our efforts to
    achieve a successful rollout in the U.S.

Other

Oral Mucositis

  *Completion of our oral mucositis phase 1a trial for cobiprostone in the
    second quarter of 2013, which we have achieved, and initiation of the next
    trial in the program in the fourth quarter of 2013.

Spinal Stenosis

  *Completion of our spinal stenosis phase 2a trial for SPI-017 in the fourth
    quarter of 2013.

Financial Results for the Quarter

For the first quarter of 2013, Sucampo reported total revenue of $16.9 million
compared to $14.4 million for the same period in 2012, a growth of
approximately 17%. The key components of revenue for the first quarter
included R&D revenue of $2.8 million, product royalty revenue of $11.7 million
and product sales revenue of $2.2 million in Japan which compare to $2.6
million, $10.9 million and nil, respectively, in the same period of 2012.

U.S. net sales of AMITIZA, as reported to us by our partner, Takeda, increased
7% to $64.9 million for the first quarter of 2013, compared to $60.7 million
in the same period of 2012. The increase in AMITIZA U.S. net sales was
primarily due to both volume and price increases, as reported to us by our
partner.

Operating Expenses

R&D expenses, comprised of expenses for clinical development of the AMITIZA
pediatric indication, clinical development of the liquid formulation of
AMITIZA, phase 1 trial expenses for oral mucositis, and clinical development
expenses for our lumbar spinal stenosis program, were $5.6 million for the
first quarter of 2013, compared to $3.4 million for the same period of 2012.
The increase was primarily due to the initiation of our phase 3 clinical trial
of lubiprostone for pediatric patients.

G&A expenses were $7.2 million for the first quarter of 2013, compared to $7.3
million for the first quarter of 2012. The slight decrease in G&A expense was
primarily due to lower legal, consulting, and other professional expenses as a
result of the conclusion of certain legal matters in 2012, partially offset by
continued investment in corporate marketing and branding and staff to support
business growth, as well as pharmacovigilance costs for Japan of $1.0 million.

Selling and marketing expenses were $5.4 million for the first quarter of
2013, compared to $4.1 million for the first quarter of 2012. The increase in
selling and marketing expenses relates primarily to commercialization and
launch costs for RESCULA, including the establishment of a Medical and
Scientific Affairs department and other related functions necessary to support
the RESCULA launch.

Loss from Operations

For the first quarter of 2013, loss from operations was a loss of $2.6
million, an increase of $2.3 million, compared to a loss of $0.3 million for
the same period in 2012.

Non-Operating Income (Expense)

Non-operating income was $0.6 million for the first quarter of 2013, compared
to income of $0.7 million for the first quarter of 2012. The first quarter of
2013 included a foreign exchange gain of $1.1 million, compared to a gain of
$1.3 million for the same period of 2012.

Net Loss

Net loss for the first quarter of 2013 was $3.1 million, compared to net loss
of $1.9 million for the same period of 2012.

Comprehensive Loss

Comprehensive loss for the first quarter of 2013 was $3.1 million, compared to
comprehensive loss of $3.5 million for the same period in 2012.

Cash, Cash Equivalents, Restricted Cash and Marketable Securities

At March 31, 2013, cash, cash equivalents, restricted cash and investments
were $95.8 million, compared to $91.4 million at December 31, 2012. At March
31, 2013, notes payable were $62.4 million, compared to $52.9 million at
December 31, 2012, including current notes payable of $28.7 million at March
31, 2013, and $19.1 million at December 31, 2012.

Stock Repurchase Plan

In September 2011, the Board of Directors (Board) authorized the repurchase of
our class A common stock under the previously approved repurchase plan, up to
an aggregate of $2.0 million. On November 2, 2012, the Board authorized the
increase of the program amount up to an aggregate of $5.0 million. During the
first quarter of 2013, we repurchased 67,762 shares at a cost of $0.3 million.

Board Members

In the first quarter of 2013, Timothy Maudlin resigned from the Board of
Directors, Barbara A. Munder and Maureen E. O’Connell were appointed as class
1 directors, and Dr. Daniel P. Getman resigned as a class 1 director and was
appointed as a class 2 director.

Company to Host Conference Call Today

In conjunction with this first quarter financial and operating results press
release, Sucampo will host a conference call today at 5:00 pm Eastern. To
participate on the live call, please dial 877-703-6104 (domestic) or
857-244-7303 (international), and provide the participant passcode 54089443,
five to ten minutes ahead of the start of the call. A replay of the call will
be available within a few hours after the call ends. Investors may listen to
the replay by dialing 888-286-8010 (domestic) or 617-801-6888 (international),
with the passcode 30982510.

Investors interested in accessing the live audio webcast of the teleconference
may do so at http://investor.sucampo.com and should log on before the
teleconference begins in order to download any software required. The archive
of the teleconference will remain available for 30 days.

About unoprostone isopropyl (RESCULA^®)

In 2009, Sucampo acquired development and commercialization rights to
unoprostone isopropyl throughout the world except in Japan, Korea, Taiwan and
the People’s Republic of China. Unoprostone isopropyl 0.12% (trade named
RESCULA) first received marketing authorization in 1994 in Japan and was
subsequently approved in over 40 countries, including approval in 2000 by the
FDA. RESCULA (unoprostone isopropyl ophthalmic solution) 0.15% is indicated
for the lowering of intraocular pressure (IOP) in patients with open-angle
glaucoma or ocular hypertension in the United States.

About lubiprostone (AMITIZA^®)

AMITIZA (lubiprostone) is a prostone, a locally acting chloride channel
activator, indicated for the treatment of CIC in adults and OIC in adults with
chronic, non-cancer pain (24 mcg twice daily) and for IBS-C (8 mcg twice
daily) in women 18 years of age and older in the United States. In Japan,
lubiprostone (24 mcg twice daily) is indicated for the treatment of chronic
constipation (excluding constipation caused by organic diseases). In
Switzerland, lubiprostone (24 mcg twice daily) is indicated for the treatment
of chronic idiopathic constipation. In the U.K., lubiprostone (24 mcg twice
daily) is indicated for the treatment of chronic idiopathic constipation and
associated symptoms in adults.

About Sucampo Pharmaceuticals, Inc.

Sucampo Pharmaceuticals, Inc. is a global pharmaceutical company focused on
innovative research, discovery, development and commercialization of
proprietary drugs based on prostones. The therapeutic potential of prostones
was first discovered by Ryuji Ueno, M.D., Ph.D., Ph.D., Sucampo’s Chairman,
Chief Executive Officer, Chief Scientific Officer, and co-founder. Prostones,
naturally occurring fatty acid metabolites that have emerged as promising
compounds with unique physiological activities, can be targeted for the
treatment of unmet or underserved medical needs. For more information, please
visit www.sucampo.com.

AMITIZA is a registered trademark of Sucampo AG. RESCULA is a registered
trademark of R-Tech Ueno, Ltd, and has been licensed to Sucampo AG. The
Sucampo logo and the tagline, The Science of Innovation, are registered
trademarks of Sucampo AG.

Sucampo Forward-Looking Statement

This press release contains "forward-looking statements" as that term is
defined in the Private Securities Litigation Reform Act of 1995. These
statements are based on management's current expectations and involve risks
and uncertainties, which may cause results to differ materially from those set
forth in the statements. The forward-looking statements may include statements
regarding product development, product potential, future financial and
operating results, and other statements that are not historical facts. The
following factors, among others, could cause actual results to differ from
those set forth in the forward-looking statements: the impact of
pharmaceutical industry regulation and health care legislation; Sucampo's
ability to accurately predict future market conditions; dependence on the
effectiveness of Sucampo's patents and other protections for innovative
products; the risk of new and changing regulation and health policies in the
U.S. and internationally and the exposure to litigation and/or regulatory
actions.

No forward-looking statement can be guaranteed and actual results may differ
materially from those projected. Sucampo undertakes no obligation to publicly
update any forward-looking statement, whether as a result of new information,
future events, or otherwise. Forward-looking statements in this presentation
should be evaluated together with the many uncertainties that affect Sucampo's
business, particularly those mentioned in the risk factors and cautionary
statements in Sucampo's most recent Form 8-K and 10-K, which Sucampo
incorporates by reference.

                                                               
Sucampo Pharmaceuticals, Inc.
Consolidated Statements of Operations and Comprehensive Income (unaudited)
(in thousands, except per share data)
                                                                   
                                                  Three Months Ended March 31,
                                                  2013             2012
                                                                   
Revenues:
Research and development revenue                  $  2,800         $  2,585
Product royalty revenue                              11,677           10,928
Co-promotion revenue                                 61               766
Contract and collaboration revenue                   164              167
Product sales revenue                               2,217          -      
Total revenues                                      16,919         14,446 
                                                                   
Cost of goods sold                                  1,282          -      
Gross profit                                        15,637         14,446 
                                                                   
Operating expenses:
Research and development                             5,629            3,352
General and administrative                           7,227            7,327
Selling and marketing                               5,389          4,089  
Total operating expenses                            18,245         14,768 
                                                                   
Loss from operations                                 (2,608  )        (322   )
Non-operating income (expense):
Interest income                                      19               20
Interest expense                                     (495    )        (592   )
Other income (expense), net                         1,081          1,274  
Total non-operating income (expense), net           605            702    
                                                                   
Income (loss) before income taxes                    (2,003  )        380
Income tax benefit (provision)                      (1,142  )       (2,308 )
Net loss                                          $  (3,145  )     $  (1,928 )
                                                                   
Net loss per share:
Basic net loss per share                          $  (0.08   )     $  (0.05  )
Diluted net loss per share                        $  (0.08   )     $  (0.05  )
Weighted average common shares outstanding -        41,461         41,702 
basic
Weighted average common shares outstanding -        41,461         41,702 
diluted
                                                                   
Comprehensive loss:
Net loss                                          $  (3,145  )     $  (1,928 )
Other comprehensive income loss:
Unrealized loss on investments, net of tax           (14     )        (3     )
effect
Foreign currency translation                        51             (1,592 )
Comprehensive loss                                $  (3,108  )     $  (3,523 )
                                                                             

                                                               
Sucampo Pharmaceuticals, Inc.
Consolidated Balance Sheets (unaudited)
(in thousands, except share data)
                                                                  
                                                    March 31,     December 31,
                                                    2013          2012
ASSETS:
                                                                  
Current assets:
Cash and cash equivalents                           $ 48,643      $  52,022
Investments, current                                  5,142          6,035
Product royalties receivable                          11,677         14,175
Unbilled accounts receivable                          166            732
Accounts receivable, net                              1,841          1,360
Deferred tax assets, current                          693            874
Deferred charge, current                              673            673
Restricted cash, current                              26,113         15,113
Inventory                                             3,958          -
Prepaid expenses and other current assets            2,694        1,930   
Total current assets                                  101,600        92,914
                                                                  
Investments, non-current                              13,614         14,408
Property and equipment, net                           1,502          1,540
Intangibles assets, net                               7,171          7,415
Deferred tax assets, non-current                      1,391          1,654
Deferred charge, non-current                          5,045          5,213
Restricted cash, non-current                          2,319          3,832
Other assets                                         709          820     
Total assets                                        $ 133,351    $  127,796 
                                                                  
LIABILITIES AND STOCKHOLDERS' EQUITY:
                                                                  
Current liabilities:
Accounts payable                                    $ 9,256       $  5,496
Accrued expenses                                      7,845          10,595
Deferred revenue, current                             941            3,700
Deferred tax liability, current                       70             -
Income tax payable                                    957            148
Notes payable, current                                28,729         19,129
Other current liabilities                            1,458        1,003   
Total current liabilities                             49,256         40,071
                                                                  
Notes payable, non-current                            33,722         33,722
Deferred revenue, non-current                         6,722          7,093
Deferred tax liability, non-current                   2,438          2,627
Other liabilities                                    1,210        1,253   
Total liabilities                                    93,348       84,766  
                                                                  
                                                                  
                                                                  
Stockholders' equity:
Preferred stock, $0.01 par value; 5,000,000
shares authorized at March 31, 2013 and December      -              -
31, 2012; no shares issued and outstanding at
March 31, 2013 and December 31, 2012
Class A common stock, $0.01 par value;
270,000,000 shares authorized at March 31, 2013
and December 31, 2012; 41,965,689 and 41,964,905      420            420
shares issued and outstanding at March 31, 2013
and December 31, 2012, respectively
Additional paid-in capital                            62,938         62,521
Accumulated other comprehensive income                16,203         16,166
Treasury stock, at cost; 524,792 and 457,030          (2,313  )      (1,977  )
shares
Accumulated deficit                                  (37,245 )     (34,100 )
Total stockholders' equity                           40,003       43,030  
Total liabilities and stockholders' equity          $ 133,351    $  127,796 
                                                                  

                                                           
Sucampo
Pharmaceuticals,
Inc.
Key Segment Information (unaudited)
                                                                  
                                                                  
(In thousands)             Americas     Europe       Asia         Consolidated
Three Months Ended
March 31, 2013
Research and               $ 2,800      $ -          $ -          $  2,800
development revenue
Product royalty              11,677       -            -             11,677
revenue
Product sales                1            8            2,208         2,217
revenue
Co-promotion revenue         61           -            -             61
Contract and
collaboration               141        12         11          164     
revenue
Total revenues               14,680       20           2,219         16,919
Cost of goods sold          23         5          1,254       1,282   
Gross profit                 14,657       15           965           15,637
Research and                 1,282        2,671        1,676         5,629
development expenses
Depreciation and             122          250          9             381
amortization
Other operating             10,317     598        1,320       12,235  
expenses
Income (loss) from           2,936        (3,504 )     (2,040 )      (2,608  )
operations
Interest income              15           4            -             19
Interest expense             -            (460   )     (35    )      (495    )
Other non-operating         (16    )    (192   )    1,289       1,081   
expense, net
Income (loss) before       $ 2,935     $ (4,152 )   $ (786   )   $  (2,003  )
income taxes
Capital expenditures       $ 14        $ 103       $ 3         $  120     
                                                                  
Three Months Ended
March 31, 2012
Research and               $ 2,479      $ 3          $ 103        $  2,585
development revenue
Product royalty              10,928       -            -             10,928
revenue
Co-promotion revenue         766          -            -             766
Contract and
collaboration               141        13         13          167     
revenue
Total revenues               14,314       16           116           14,446
Cost of goods sold          -          -          -           -       
Gross profit                 14,314       16           116           14,446
Research and                 822          1,517        1,013         3,352
development expenses
Depreciation and             120          220          10            350
amortization
Other operating             10,053     716        297         11,066  
expenses
Income (loss) from           3,319        (2,437 )     (1,204 )      (322    )
operations
Interest income              18           2            -             20
Interest expense             -            (550   )     (42    )      (592    )
Other non-operating         75         190        1,009       1,274   
expense, net
Income (loss) before       $ 3,412     $ (2,795 )   $ (237   )   $  380     
income taxes
Capital expenditures       $ 40        $ -         $ -         $  40      
                                                                  

Contact:

Sucampo Pharmaceuticals, Inc.
Silvia Taylor, 1-240-223-3718
staylor@sucampo.com
 
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