So, SCMP decided to exercise its option and started to do marketing for OIC in US beside Takeda since OIC has very large market (almost as large as other indications combined). The first step was to hire a CEO with commercializing experiences and then adding the marketing group.
If a doctor sees a patient and decides a need for OIC, then he may not write prescription for another drug to relief constipation while Amitiza can do all (OIC, CIC and IBS). Thus, I am expecting a surge in Amitiza prescriptions this year. The Amitiza revenue in US may reach $500m. Remember that OIC prescription growth was 31% month over month on average (based on filing if I understands it correctly). also, adding anothrer surge in Japan (limitation was removed) and some surge in Europe then SCMP will get rev and income that exceed current estimates by a mile.
Martin, potential partners are not stepping back, this is SCMP that is very cautious. SCMP was happy with Takeda and it does not want another company like Takeda as partner.
Amitiza is the only approved oral drug in US for OIC. Several companies tried to get it and failed. SLXP is willing to pay $250 m to get the marketing right of the a drug (Restila) if it is provided orally.
SGYP that does not have any drug yet but coping a drug like LIZNESS from IRWD thinks that its market cap should be much above $500m.
LIZNESS that was though to be a safe drug, it is not. At least one report suggest that FDA may require it to add a warning label. LIZNESS may cause severe diarrhea in some patients.
The market for CIC and IBS-B is $2 B with 35m patients suffering from CIC and 13m suffering from IBS-B in us.
So, as med_investor indicated, SCMP may go after patients 7 to 17 years old first with solid capsule. This market is out of reach of competitors since safety is very important. Over 8 millions have used Amitiza and it has proven that it is safe for patients under 18.
Put all above together, should SCMP trade at market cap of low $300M?
Just having a drug for OIC in US, the market cap should be close to $500 m.
Just having a drug for CIC and IBS-B in US, the market cap should be close to $600 m.
Jus having an approved drug for CC in Japan, the market cap should be close to $150 m.
Just having CIC approved drug in UK and Switzerland, the market cap should be close to $80 m.
Forget about pipeline, Rescula and other things and gIve half of above numbers to partners, still SCMP market cap points to a number above $600m, something that SGYP with no drug but plenty of speculation is almost pointing to now.
In my opinion, selling in this circumstances is a big mistake since seller will be right in hands of shorts. The price will cover eventually and sellers end up with losses. If this was a company with weak balance sheet and negative income that all the hopes will be vanished then I threw the towel. However, the current revenue/income and growth from existing proved products points to much higher $8 per share. Now add some of the pipeline or future action then $10 minimum is reasonable price.
Now, the company has rushed to several different directions and has lost the focus. This is obvious from its large pipeline, although most of costs are paid by partners and that is a good point.
Going after a small population of patients (over 65 and difficult case) was a mistake. Fortunately lesson learned and as the PR indicated, a larger population with better formulation should be pursued. Meanwhile, this will not affect pediatric version of solid Amitiza for ages 7 to 17.
The pipeline should be streamed and only promising ones should be pursued to save money. On the other hand, the company should put some effort in Rescula marketing with right people or at least find a good partner to market it.
Conclusion is that I cannot convince myself to reduce even one share but I may add some shares to average down. Sooner or later, this will recover.
You should not time your stock purchase.
There won't be a home run for very drug and every indication at all countries. US is much tougher than Europe countries and Japan is even harder. Amitiza is approved for 3 indications in US but it may not get all 3 in other countries that have different requirements especially for pain that is hard to measure and different people may measure it differently.
Read the released 10-k, it has good info and SCMP business plan has been excellent even the deal it has with Takeda.
Most expenses for new Amitiza indications (pediatric, and senior adult) are paid by Takeda in US and Canada.
SCMP has not applied for Amitiza approval in Canada yet but that will be next step.
I agree with both of you and add this, if you look at the chart since 2008 then you see a perfect CUP is forming. The rim is at $18. I think this cup will be completed by early 2015 if not sooner.
If a few things are straighten up by new CEO then there is possibility of $25 or higher. I see many catalysts to get there.
1- New deals for AMITIZA in China, South America and many other countries.
2- OIC indication in UK and Switzerland in next 2 months.
3- Amitiza in other EU countries.
4- Completion of Phase 3 of lubiprostone in pediatric functional constipation which include a) children 6 months to 6 years old (liquid version) and b) children 7 to 17 (solid version).
5- liquids version of above for people over 65 years old.
6- Completion of phase 3 of unoprostone isopropyl for retinitis pigmentosa in Japan.
7- Completion of phase 2b ion channel activator (LSS).
8- Completion of phase 1b cobiprostone for oral mucositis.
9- Launching of Rescula successfully.
10- OIC indication of Amitiza is the only oral drug. The one that SLXP is paying $250 m is injection and it is not as effective as Amitiza. That price actually tell us how cheap SCMP is. The current market cap of $350 is joke.
Issue 15 million convertible at price around $15.
Cancel Takada contract and pay some fine ($20m to $50m).
Organize a strong sale and marketing org.
Get new drugs to the market (Amitiza for children and seniors above 65 years, other drugs).
Get more indications for Rescula.
Buyback some of Dr U shares.
SCMP just use takada and abbott as sale and marketing and it can cancel its contracts and of course it will pay some money for this purpose. Let me give you an example: POZN gave one of its drug, Vimovo to AST for sale and marketing. POZN will not happy with AST so it cancelled its contract and replaced AST with HZNP as its sale and marketing with better contract and higher royalty. For this purpose, HZNP had to pay $15 m to AST. Bottom line, SCMP can cancel its contract with takada and pay some money as fine to takada for reversing its contract.
OIC indication sale that is growing at 31% per month belong to SCPM. New CEO first goal is to get the share price to $16 and I think he can do it in 2014 and that is why he accepted this job.
$8.50 was the support. The trend is upward and resistance is around $9.60. As soosn as we break $9.60 then we look at $10 and $11.
There will be a way and there are many investors (as indivitual or a company) willing to pay Dr Ueno something about $30 or higher per share for his shares and get the control of the company.
Dr Ueno is a very good scientist but lack marketing and sale experience. New CEO will fill the gap and Dr Ueno and other shareholders will be happy to see their shares at reasonable prices.
IRWD and even SGYP market caps are 5 to 2 times of SCMP market cap. SGYP does not have a drug and its only drug is in phase 2 to do one indication of Amitiza but has twice SCMP market cap. This need to be changed.
My god, SCMP pipeline is over $15 per share while Amitiza is producing money and eventually Rescula will do the same.
There have been two confirmed reports of overdosage with Amitiza. The first report involved a 3-year-old child who accidentally ingested 7 or 8 capsules of 24 mcg of Amitiza and fully recovered. The second report was a study patient who self-administered a total of 96 mcg of Amitiza per day for 8 days. The patient experienced no adverse reactions during this time.
If the same thing happens with IRWD, LINZESS drug, for sure the 3 years old kid and the adult patient could not survive.
SCMP Amitiza is proven drug for constipation and it has more indication approval and primery drug for health care. The liquid version of Amitiza for children and seniors who cannot swallow pills will be available in late 2014, early 2015. SCMP balance sheet is superior with low float and at least 3 drugs in phase 3 and a few in phase 2 and 1.
The new CEO is good news to put the company in a good position for sale. The price may be much higher when a few more drugs get approval here in US/EU/Japan...And we know that some drugs will get approval in early 2015.
I meant to say, the new Amitiza will be marketed in 2015 after approval from FDA.
IRWD failed for people under 18, however Amitiza has 2 new version of Amitiza in phase 3 that will be market in 2013. One for children and another for old people who cannot take pills. There are other version but two above will add at least a gew dollars to the current depressed prices.
SCMP is profitable, has strong pipeline and very clean balance sheet with very low float plus a new CEO with experience in sale and marketing. This is a stock that you want to have to double your money at minimum.
Only 9 million float and Shorts are gambling here. This could be $15 stock easily.
They are crazy or they are throwing money if they don't cover today or by next few days.
ATML is stuck in single digit price in past few decades even though a few times market push it to double digits price for a short time. Things has to be changed around.
ATML should learn from BRCD, RFMD and others to change things around since it has not been working for it so far and it won't work in future.