On May 10, 2018 Synergy Pharmaceuticals Inc. (NASDAQ:SGYP), a biopharmaceutical company focused on the development and commercialization of novel gastrointestinal (GI) therapies, reported its financial results and business update for the three months ended March 31, 2018 (Press release, Synergy Pharmaceuticals, MAY 10, 2018, View Source [SID1234526501]).

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"The first quarter of 2018 was all about executing on our three key business priorities of optimizing the value of TRULANCE, ensuring a strong financial foundation, and continuing to explore all strategic business development opportunities," said Troy Hamilton, Chief Executive Officer of Synergy Pharmaceuticals Inc. "With TRULANCE, we saw continued growth in prescriptions, market share and its prescriber base and with the IBS-C launch in late February, we have the opportunity to continue to drive further sales growth. In addition, we continued to efficiently manage our operating expenses by prioritizing key investments in areas of high return, such as expanding market access. Finally, we amended our debt agreement to allow for more flexible access to capital as we are pursuing strategic options that align with our core mission to deliver exceptional value to our patients, customers and shareholders. Overall, our progress against our key business priorities during the first quarter reflect our commitment to maximizing shareholder value while also maintaining our focus on providing safe and effective treatment options for patients living with chronic GI conditions."

First Quarter 2018 and Recent Highlights

Optimizing the Value of TRULANCE

44,177 TRULANCE 30-count packs were dispensed in the first quarter of 2018, resulting in a total of 132,628 TRULANCE 30-count packs dispensed since the product’s launch on March 20, 2017, per IQVIA.
TRULANCE was the only prescription brand for CIC and IBS-C to show positive total and new prescription volume growth in the first quarter over the prior quarter, per IQVIA.
In the nine weeks since the launch of the IBS-C indication in late February, TRULANCE prescription volume grew 24% versus the prior nine weeks or nearly five times the branded CIC and IBS-C prescription market growth rate, per IQVIA.
The total number of unique healthcare practitioners prescribing TRULANCE since launch reached nearly 12,000 in the first quarter of 2018, increasing more than 20% over the prior quarter, per IQVIA.
TRULANCE currently has over 70% payer coverage across all segments including commercial, Medicare Part D and Managed Medicaid.
Ensuring a Strong Financial Foundation

Financial Results

Reported TRULANCE net sales were $8.6 million in the first quarter of 2018 compared to net sales of $9.4 million during the fourth quarter of 2017. TRULANCE first quarter net sales of $8.6 million increased by 18% compared to fourth quarter of 2017 adjusted net sales (non-GAAP) of $7.3 million.
Reported total operating expenses were $43.5 million in the first quarter of 2018 compared to total operating expenses of $43.8 million during the fourth quarter of 2017.
Total adjusted operating expenses (non-GAAP) were $40.6 million in the first quarter of 2018 compared to $41.1 million in total adjusted operating expenses (non-GAAP) in the fourth quarter of 2017.
In February 2018, Synergy amended its Term Loan agreement with CRG to provide more financial flexibility while the company continues to evaluate various strategic options. Synergy has the ability to access up to an additional $100 million in 2018 in three tranches.
Synergy received $5.0 million in non-refundable upfront payments related to the TRULANCE Canadian licensing agreement with Cipher Pharmaceuticals completed in February 2018. This payment was recorded as deferred revenue for the quarter and will be recognized as revenue upon meeting future contractual obligations. Under the terms of the licensing agreement, Synergy is eligible for an additional milestone payment upon regulatory approval in Canada, as well as royalties from Trulance product sales in Canada.
Synergy reported a net loss of $36.1 million, or $0.15 per share, for the first quarter of 2018.
Cash and cash equivalents were approximately $98.7 million at the end of the first quarter.
2018 Financial Guidance

As a result of ongoing efforts to improve cost efficiency measures, Synergy is lowering projected total adjusted operating expense (non-GAAP) guidance for 2018 to be in the range of $165 million – $175 million versus previously guided $175 million – $185 million.
Exploring All Strategic and Business Development Opportunities

Collaborations & Partnerships

Synergy initiated a partnership with the National Cancer Institute (NCI) to collaborate on a NCI-funded and managed clinical biomarker study to evaluate dolcanatide’s potential to prevent colorectal cancer. The study will assess the colorectal bioactivity of dolcanatide in healthy volunteers and will inform the feasibility and design of a larger study. This is the first clinical biomarker study evaluating the potential benefit of using a uroguanylin analog in colorectal cancer prevention. The advancement of Synergy’s proprietary uroguanylin analog, dolcanatide, into this clinical trial builds on Synergy and NCI scientists’ pioneering work showing the important role of uroguanylin in the complex biology of colorectal cancer.
Synergy’s Canadian partner, Cipher Pharmaceuticals, is currently in discussions with Health Canada and plans to file a New Drug Submission for TRULANCE in IBS-C in the second half of 2018. The regulatory review period is approximately one-year from the submission date.
Ongoing Strategic Review

Synergy continues to engage in an ongoing review of strategic business opportunities focused on maximizing shareholder value. This review process includes, but is not limited to, potential US and ex-US partnerships, licensing, and merger and acquisition transactions. Synergy expects to provide further updates on or before it reports second quarter 2018 results.
First-Quarter Conference Call & Webcast

Synergy will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss first quarter 2018 results. Participants may access the conference call by dialing 877-407-3978 (US and Canada) or 412-902-0039 (International). Please let the operator know you would like to join the Synergy Pharmaceuticals call. To access the webcast as well as a PDF copy of the presentation, please visit the Investors section of Synergy’s website at www.synergypharma.com.

An audio replay of the conference call will also be available beginning approximately two hours after the call’s conclusion, and will remain available through May 24, 2018. The replay may be accessed by dialing 877-660-6853 (U.S. and Canada) or 201-612-7415 (International) and entering conference ID number 13668774. A replay of the webcast will also be available on the Investors section of Synergy’s website at www.synergypharma.com.