Synergy Pharma shares soar from constipation drug study
- Positive results on the efficacy of Plecanatide pushed the stock up 66% yesterday.
- Plecanatide facilitates normal bowel function by mimicking a hormone that promotes fluid secretion in the gastrointestinal tract.
- Currently, only two approved drugs that treat idiopathic constipation exist---Amitiza from Sucampo/Takeda and Linzess from Allergan/Ironwood.
Synergy's stock is up because of positive clinical trial data, which suggests that Plecanatide may be more tolerable and potentially more effective than Linzess. One key point is that discontinuation rates for Plecanatide versus Linzess were 6% and 8%, respectively, in trials. While there is a need for additional treatment options for for idiopathic constipation, which affects roughly 15% Americans, another plus for Synergy is the possibility of a buyout.
Analysts think that Synergy may be a nice fit for Valeant's gastrointestinal franchise, which includes recently approved Xifaxan for treatment of irritable bowel syndrome. Currently, Synergy's market value is $464 million and growing.