Two years ago, Sucampo Pharmaceuticals wanted a divorce from its marketing partner, so it took its case to the International Chamber of Commerce's International Court of Arbitration in Paris.
Late last week, the court said no.
The Bethesda company had claimed that Takeda Pharmaceuticals U.S.A. of Deerfield, Ill., failed to adequately promote its constipation drug, Amitiza, which came on the market in 2006.
But the court backed Takeda, which is primarily responsible for marketing the drug in the U.S., and did not award any legal fees or costs.
The ruling means the companies' agreement will continue through October 2020.
"We're evaluating all the options," Stanley G. Miele, senior vice president, sales and marketing president, Sucampo Pharma Americas, said in an interview July 6.
"Sucampo is disappointed with the [court's] decision," the company said in a statement.
Investors were, too. Sucampo shares fell 39 percent on the news and have not recovered.
"We are disappointed in the market response," Miele acknowledged. However, Sucampo still is in a "very strong financial position ... and we are confident we will perform and meet our shareholders' expectations."
The good news, said company co-founder, Chairman and CEO Ryuji Ueno, is that the arbitration process proved that "Takeda doesn't want to lose Amitiza. They continue to say they need Amitiza."
According to Sucampo's most recent annual report filed with the Securities and Exchange Commission, "Takeda currently promotes Amitiza in the U.S. to only office-based specialty and a limited number of primary care physicians. ... We believe Takeda has breached its obligations to us by not generating an appropriate level of U.S. sales of Amitiza and other failures of performance under our agreements."
Amitiza sales last year hit $226.4 million in the U.S., up 6.6 percent from 2010, Sucampo reported. The company's sales royalties totaled $41.5 million last year and $10.9 million in the first quarter of this year.
"However despite Takeda’s failure to use best efforts to maximize net sales, we believe Amitiza, with a competitive marketing and sales campaign, still has great potential for future growth in the U.S. ...," the company said in its SEC filing. "We believe that due to the lack of best efforts by our commercial partner, Amitiza has low patient awareness, low physician awareness of disease morbidity and co-morbidities, low therapy awareness among primary care and gastroenterology specialist physicians and inappropriate managed care restrictions on access."
Miele said Sucampo officials will work with Takeda to improve its promotion efforts.
"An important component now is that we have new data sources," he said, a result of Sucampo's “robust market research” during the arbitration process.
Specifically, the data show the need to improve consumer awareness, managed care positioning and presentations by representatives and physicians, Miele said.
"The investment we made during arbitration will now be capitalized," Ueno said.
Also, Takeda has shown an "improved behavioral pattern" since Sucampo filed its complaint in 2010, Miele said.
"Takeda is starting to listen to us," Ueno said.
For its part, Takeda said it is “pleased with the arbitral tribunal’s decision which has reaffirmed Takeda’s right to lead commercial activities for Amitiza in the U.S. marketplace,” spokeswoman Jocelyn M. Gerst wrote in an email to The Gazette. “We will continue to work toward the commercial success of Amitiza in the U.S. and make this important product available to the patients who need it.”
Amitiza is Sucampo’s only drug on the U.S. market, and it is seeking approval to market it for new conditions, including constipation in patients taking opium-based painkillers.
Last week, Sucampo reported that a subsidiary has won government approval in Japan to market Amitiza there.
Under a 2009 agreement, Sucampo and Abbott Japan will commercialize and supply the drug in Japan. Sales are expected to start in the fourth quarter.
Sucampo also has filed an application with the Food and Drug Administration to market Rescula, a glaucoma treatment that generates annual sales of $50 million to $60 million in Japan, according to Ueno, who developed the drug. The company hopes to begin U.S. sales this year, Miele said.
Sucampo has tried to raise its profile this year. Ueno and his wife, Sachiko Kuno, also a Sucampo director and co-founder, recently granted a long media interview after buying a Georgetown mansion in Washington, D.C. And the company last month began underwriting news programs on National Public Radio.
"We need to support public radio," Ueno said. "We need to take some role leading biotechs in Maryland and say we're a Bethesda-based company."