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EXCLUSIVE LIFE SCIENCE FEATURE leaders LIFESCIENCELEADER.COM MARCH 2015 36 CEO Yasuchika Hasegawa. "Since then, we have rebuilt our relationship from the bottom up and the top down, and I do not think we would have been successful in signing the multiple agreements we did with Takeda without having done that basic building-block work." One of the basic building blocks was simple trust, says Greenleaf. "Takeda is a global pharma company with presence in countries around the world. I believe that they have done a good job with the product Amitiza in the United States. They know the product inside and out, and our partnership has never been bet- ter. Takeda is the right company to take a product like Amitiza forward in the global markets, and we are excited not only about the extension and the expansion of our agreement, but also about how our relationship evolves in the future." THE FOCUS INTERNAL In addition to the changes with Amitiza, Greenleaf and his team saw other opportunities to shed resource-draining activities, such as the direct selling of Rescula in the United States, which Sucampo made the decision to terminate in the third quarter of 2014. The move reflected an overall strategy to focus more resources in development on the highest contributing areas, but Greenleaf says it also just made sense based on the "pure math" of cost versus revenue. "Rescula was late in its life cycle. The market had significantly moved beyond the treatment of IOP associated with glaucoma. Most of the leading brands are either used in combination or are generic, and we had tried our best to sell the prod- uct through the infrastructure we built around it. But in the end, we were not able to sell enough product to make a decent return on investment, so we decided to try to find a partner who could leverage Rescula along with other products in its portfolio. It doesn't mean we will partner all future products, but right now it is better to use those resources to focus on maturing our pipeline." Some advantages of being a commercial company with the sales burden largely partnered are obvious: positive revenue, ROI, and R&D; resources. Of course, all of them are rare among small compa- nies at the development stage, for whom operating at a loss is the normal mode. Greenleaf observes how investors have different sets of criteria for commercial and development-stage companies. "A commercial company is examined for revenue, cash flow, profit, sales trends, and other objective factors. But investors look at a development-stage company by such terms as its product's market size, impact on the competitive set, and options for acquisition, as well as how to develop the company's valuation. Sucampo has the best of both worlds: inflow of resources to fund the pipeline without doing mul- tiple dilutive rounds through investors to raise capital, and leveraging of resources through partnerships." Greenleaf defines his main goal as leading the company and its investors toward large-scale growth and full integration. "We will have multiple products available in multiple therapeutic areas, signifi- cantly solving unmet medical needs and giving back significantly to our share- holders. As we evolve and revenue grows, we will always invest in the pipeline, but when we get a product that gives us a high enough rate of return, we will consider moving back into the commercial space." PIPELINE EXPANSION The next challenge for Sucampo is deliver- ing on its pipeline-development strategy. Greenleaf is confident the company will succeed in maintaining the flow of new products in a timely way, following a practical strategy of short-term product acquisition and longer-term pipeline development. He elaborates: "Securing Amitiza and its revenue, while ensuring it grows several million dollars during the next five to ten years, is critical. Most of our pipeline is about three to five years out, so any exter- nal deals we do will probably fall within that same window. Our hope is to have multiple shots on goal — and to produce new products over the next three to five years that replace the current and growth revenue of Amitiza." Two other key parts of expanding Sucampo's product portfolio are widening its therapeutic focus and moving beyond its hitherto exclusive reliance on pros- tones. Both are essentially further steps in scale-up, requiring new investment and resource management as have other pivot- al points of growth in the company's past. "When we stopped doing Rescula's mar- keting, we did not simply take all of those freed-up resources and drop them to the SUCAMPO'S DECLARATION OF INDEPENDENCE By W. Koberstein SUCAMPO'S INDUSTRY BRAIN TRUST When Peter Greenleaf joined Sucampo as CEO in the spring of 2014, one of his top priorities was to beef up the small, mainly virtual company's management team with industry-experienced leaders. By fall of the same year, he had hired Peter Kiener, D.Phil., as its CSO and two other new executives for the management team, Matthias Alder to head business development and licensing and Steven Caffé, M.D., to run regulatory affairs. Another past MedImmune alum, Kiener came to Sucampo from his CSO position at Ambrx and had been president and cofounder of start-up Zyngenia. Alder hails from numerous small biotechs, and Caffé has a Big- Pharma and specialty-pharma background, having held key positions at MedImmune, Baxter, Sanofi, and Merck, as well as AMAG Pharmaceuticals.