Synergy Pharmaceuticals Inc.'s (NASDAQ:SGYP) Trulance use in a meaningful percentage of new vs. switching CIC patients could suggest better long-term uptake than expected; thus, Cannacord await details, potentially on 2Q17 SGYP earnings. The firm will focus on launch details rather than consensus for 2Q17, since it looks for information on longer-term launch trends. Cannacord believes the simple, real-world reality for CIC is that Trulance does not have the diarrhea concerns of Linzess, and that Trulance can be taken with or without food.
The firm looks for commentary on the 2Q17 Ironwood call regarding inventory changes for Linzess, as well as any changes to discounts, rebates, or sampling, which could indicate pressure from Trulance. Linzess weekly TRx counts have recovered from a ~7.5% drop in early January 2017 vs. late December 2016, but Cannacord wonders if additional discounts or other measures have been utilized.
The firm expects Trulance efficacy and safety to be the same regardless of usage before or after Linzess, based on Linzess retreatment data from 2014. Ironwood and Forest showed in Trial 31 that patients who received Linzess for 12 weeks, then placebo for 4 weeks, followed by a return to Linzess afterwards showed high satisfaction. Cannacord believes this shows that patients who may "switch" from Linzess to Trulance are likely to experience good efficacy, even after a treatment break. Interestingly, Linzess data actually showed that after returning to Linzess, patients showed a higher satisfaction score than before they had stopped.
The firm maintains its BUY rating and $13 PT based on its view that Trulance differentiation on safety and ease of use will result in a successful long-term launch. Cannacord recognizes that Allergan / Ironwood's Linzess is embedded in the market with strong salesforce support, but it believes that Trulance is simply easier for doctors to give and for patients to tolerate.