UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549



FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  May 7, 2013

Sucampo Pharmaceuticals, Inc.

(Exact Name of Registrant as Specified in Charter)

Delaware

001-33609

30-0520478

(State or Other Jurisdiction

of Incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

4520 East-West Highway, 3rd Floor

Bethesda, Maryland

20814

(Address of Principal Executive Offices) (Zip Code)


Registrant’s telephone number, including area code: (301) 961-3400

 
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Item 2.02  Results of Operations and Financial Condition

On May 7, 2013, Sucampo Pharmaceuticals, Inc. (“the Company”) announced its consolidated financial results for the quarter ended March 31, 2013. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K. The slides from the presentation will be referenced below are incorporated by reference.

The information in this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 7.01. Regulation FD Disclosure.

On May 7, 2013, the Company will host a conference call with investors to discuss the Company's financial and operating results for the quarter ended March 31, 2013. The conference call including slides will be made available to the public via conference call and webcast. The slides from the presentation are being furnished as Exhibit 99.2 to this Current Report on Form 8-K.

The information in this Item 7.01 and Exhibits 99.2 to this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01  Financial Statements and Exhibits

          (d)       Exhibits

                    The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

99.1      Press Release issued by the Company on May 7, 2013.
99.2      The corporate update presentation slides dated May 7, 2013.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

SUCAMPO PHARMACEUTICALS, INC.

 

 
Date: May 7, 2013 By:  

/s/ Thomas J. Knapp

 

Name:

Thomas J. Knapp

 

Title:

EVP, Chief Legal Officer and Corporate Secretary

Exhibit 99.1

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

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

BETHESDA, Md.--(BUSINESS WIRE)--May 7, 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 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.

Global

Japan

Europe


RESCULA

Other

Oral Mucositis

Spinal Stenosis

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 - basic   41,461     41,702  
Weighted average common shares outstanding - diluted   41,461     41,702  
 
Comprehensive loss:
Net loss $ (3,145 ) $ (1,928 )
Other comprehensive income loss:
Unrealized loss on investments, net of tax effect (14 ) (3 )
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 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively

420 420
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 shares (2,313 ) (1,977 )
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 development revenue $ 2,800 $ - $ - $ 2,800
Product royalty revenue 11,677 - - 11,677
Product sales revenue 1 8 2,208 2,217
Co-promotion revenue 61 - - 61
Contract and collaboration revenue   141     12     11     164  
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 development expenses 1,282 2,671 1,676 5,629
Depreciation and amortization 122 250 9 381
Other operating expenses   10,317     598     1,320     12,235  
Income (loss) from operations 2,936 (3,504 ) (2,040 ) (2,608 )
Interest income 15 4 - 19
Interest expense - (460 ) (35 ) (495 )
Other non-operating expense, net   (16 )   (192 )   1,289     1,081  
Income (loss) before income taxes $ 2,935   $ (4,152 ) $ (786 ) $ (2,003 )
Capital expenditures $ 14   $ 103   $ 3   $ 120  
 
Three Months Ended March 31, 2012
Research and development revenue $ 2,479 $ 3 $ 103 $ 2,585
Product royalty revenue 10,928 - - 10,928
Co-promotion revenue 766 - - 766
Contract and collaboration revenue   141     13     13     167  
Total revenues 14,314 16 116 14,446
Cost of goods sold   -     -     -     -  
Gross profit 14,314 16 116 14,446
Research and development expenses 822 1,517 1,013 3,352
Depreciation and amortization 120 220 10 350
Other operating expenses   10,053     716     297     11,066  
Income (loss) from operations 3,319 (2,437 ) (1,204 ) (322 )
Interest income 18 2 - 20
Interest expense - (550 ) (42 ) (592 )
Other non-operating expense, net   75     190     1,009     1,274  
Income (loss) before income taxes $ 3,412   $ (2,795 ) $ (237 ) $ 380  
Capital expenditures $ 40   $ -   $ -   $ 40  
 

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

Exhibit 99.2

GRAPHIC

First Quarter 2013 Results May 7, 2013


GRAPHIC

Introductions and Forward-Looking Statements Silvia Taylor Senior Vice President, Investor Relations, Public Relations and Corporate Communications


GRAPHIC

Agenda Introductions and Forward-Looking Statements Hightlights of the Quarter Commercial Update Pipeline and R&D Update Financial Performance Closing Remarks Silivia Taylor Ryuiji Ueno, MD, PhD, PhD Stanley G. Miele Taryn Joswick Cary J. Claiborne Cary J. Claiborne


GRAPHIC

Forward-Looking Statements This presentation 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 US 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.


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Q1 2013 Highlights Ryuji Ueno, MD, PhD, PhD Chairman, Chief Executive Officer, Chief Scientific Officer, and Co-founder


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Highlights AMITIZA RESCULA Pipeline FDA approval for OIC indication in April; $10M milestone payment upon first sale for OIC, expected in Q2 Strong US sales growth – Q1 up 7% YoY to $64.9M Japan launch surpassing all initial metrics Completed OIC filings in Switzerland and UK Began MRP to seek approval for AMITIZA for CIC in additional European markets Initial interest by potential licensing partners for AMITIZA for new indications and new territories Launched with our own sales force; initial feedback positive Initiated P2A trial of SPI-017 (IV) for severely symptomatic lumbar spinal stenosis Completed P1A trial of cobiprostone for oral mucositis; results expected Q2 R-Tech Ueno, Ltd. granted funding by Japan Science and Technology Agency for P3 trial of unoprostone isopropyl for retinitis pigmentosa; first patient enrolled


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Commercial Update Stanley G. Miele President, Sucampo Pharma Americas and SVP, Sales and Marketing


GRAPHIC

AMITIZA US sNDA for OIC approved in April Unmet need: more than 200M prescriptions for opioid use in the U.S. annually1; approximately 40-80% of patients taking opioids chronically for non-cancer pain report constipation2,3 $10M milestone payment upon first sale for OIC expected Q2 Takeda reps to begin selling week of May 13 Q1 TRx growth: +4% YoY Q1 net sales increase: up 7% YoY to $64.9M Over 7M prescriptions over 7 years Expect to rise exponentially See References 1-3


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RESCULA US Significant Market Opportunity Patients with open-angle glaucoma or ocular hypertension In the US: 2 million US glaucoma patients4, additional 3-6 million with ocular hypertension5 Unique mechanism of action (BK channel activator) and well-tolerated safety profile Launched with our own sales force Positive feedback and significant progress More than 12,000 face-to-face calls Over 70,000 samples shipped See References 4-5


GRAPHIC

AMITIZA Globally Japan Europe/UK First-ever prescription medicine approved for chronic constipation All launch metrics have been surpassed: revenue and patient numbers tracking above expectation Sucampo received $2.2M of product sales revenue, double our internal forecast Initiated NICE endorsement process in UK Initiated MRP (CIC) in additional EU markets OIC indication filed in both Switzerland and UK On track to commence active marketing (CIC) in Switzerland in Q2 We have also received expressions of interest from potential partners for AMITIZA for new indications and new territories, including Europe, Asia and emerging markets


GRAPHIC

Pipeline and R&D Update Taryn Joswick Vice President, Clinical Development


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AMITIZA P3 pediatric trial FPFV in Q3 2013 Pediatric functional constipation indication Takeda to fund significant amount of developmental costs Developing new liquid dosage form Some patients cannot swallow gel caps Pediatric Geriatric 100% of development costs to be reimbursed by Takeda Evaluate potential of AMITIZA for additional LCM opportunities


GRAPHIC

SPI-017 for Lumbar Spinal Stenosis LSS caused by degenerative change in lumbar spine Very common disease observed in growing aged population Unmet medical need as demonstrated by lack of treatment options globally Ongoing P2A trial of SPI-017 (IV); expect to conclude in Q4 2013 Diagram from American Academy of Orthopaedic Surgeons website:  www.orthoinfo.aaos.org


GRAPHIC

SPI-8811 (cobiprostone) for Oral Mucositis Oral mucositis is a severely painful inflammation of the oral cavity 100% incidence rate in certain cancers6 Unmet medical need; no oral prescription treatments available P1 trial in healthy volunteers completed New oral spray formulation Awaiting results; expect in Q2 See Reference 6; photos from Silverman. Diagnosis and management of oral mucositis. J Support Oncol 2007; 5 (2 Suppl 1):13-21.


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Financial Performance Cary J. Claiborne Chief Financial Officer


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Q1 2013 Financial Highlights $M +17% +7% +7% $14.4 $16.9 $10.9 $11.7 $60.7 $64.9 Q1-12 Q1-13 Total Revenues Q1-12 Q1-13 Product Royalty Revenue AMITIZA Net Sales Q1-12 Q1-13


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Q1 2013 Financial Highlights $M except EPS Operating Loss Net Loss EPS G&A Selling & Marketing R&D Expense Q1 2013 ($2.6) ($3.1) ($0.08) $5.6 $7.2 $5.4 Q1 2012 ($0.3) ($1.9) ($0.05) $3.4 $7.3 $4.1


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Q1 2013 Financial Highlights Cash position $95.8 million as of March 31, 2013 Repurchased 67,762 shares during quarter Recently raised authorized amount to $5 million One class of common stock


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Conclusion Cary J. Claiborne Chief Financial Officer


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2013 Key Value Drivers Obtain approval of OIC sNDA: Q2 2013 $10M milestone payment upon first OIC sale Achieve FPFV in Pediatric P3 trial by H2 2013 Pursue strategic alliances; new AMITIZA indications / territories Grow sales in Japan in 2013 Submit for regulatory approval of OIC in Switzerland and UK by Q1 2013 Begin active marketing in Switzerland for CIC Seek NICE endorsement for CIC and OIC, and make AMITIZA available in UK for CIC Use MHRA approval to seek expansion of CIC indication to other EU markets via MRP Launch: Q1 2013 Complete oral mucositis P1A trial: Q2 2013 Initiate P1B/2A trial in oral mucositis: Q4 2013 Complete spinal stenosis P2A trial: Q4 2013 AMITIZA RESCULA Pipeline US Global Japan EU US Cobiprostone SPI-017 Completed In Process


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Q&A


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References Manchikanti L, et al. Pain Physician. American Society of Interventional Pain Physicians (ASIPP) guidelines for responsible opioid prescribing in chronic non-cancer pain: Part 2--guidance. 2012 Jul;15(3 Suppl):S67-116. Camilleri M. Opioid-induced constipation: challenges and therapeutic opportunities. Clinical and Systematic Reviews. 2011; 106: 835-842. ClearView Analysis 2008 American Academy of Ophthalmology Glaucoma Panel. Preferred Practice Pattern® guideline: Primary open-angle glaucoma. 2010 Kass MA et al. Arch Ophthalmol. The Ocular Hypertension Treatment Study: a randomized trial determines that topical ocular hypotensive medication delays or prevents the onset of primary open-angle glaucoma. 2002 Jun;120(6):701-13; discussion 829-30. Trotti A et al. Radiother Oncol. Mucositis incidence, severity and associated outcomes in patients with head and neck cancer receiving radiotherapy with or without chemotherapy: a systematic literature review. 2003 Mar;66(3):253-62.