Pfizer Inc. (NYSE:PFE)'s Lipitor (Atorvastatin), a statin used to lower levels of LDL (bad) cholesterol and increase levels of HDL (good) cholesterol, topped the list of best selling branded drugs for nearly a decade. In 2001, patients filled more than 57 million prescriptions for Lipitor. However, the drug had its share of problems. Jay S. Cohen, M.D. is a nationally recognized expert in the area of medications and side effects. He wrote about hearing more complaints about side effects from Lipitor than all of the other drugs in its class combined. "Perhaps this is because the standard dosage of Lipitor is so strong; it is far stronger than many patients actually need or can tolerate," he wrote.

He also wrote, "The Lipitor dosage guidelines do not distinguish between patients with or without heart disease. They do not distinguish between patients requiring large reductions and those needing small reductions. The recommended initial dose of Lipitor, 10 mg, is so powerful that doctors can treat many patients with the same dose and not have to bother matching the dose to individual patients."

Similarly, Merck & Co., Inc. (NYSE:MRK)'s Vioxx (Rofecoxib) was withdrawn from the market after safety concerns arose. It was developed to treat osteoarthritis and other acute pain conditions. The drug was later found to increase the risk of heart attacks, which led to Merck withdrawing it voluntarily.

Bristol Myers Squibb Co. (NYSE:BMY)'s Yervoy (Ipilimumab) is used to treat skin cancer. It was later found to be associated with potentially fatal T cell activation and proliferation. Serious side effects related to the gastro-intestinal tract were observed as well. These examples should be enough for us to conclude that just because a drug enters the market first does not mean it will have an upper hand, especially when it has unpleasant side effects.

Insider Buying

With that in mind, I am not surprised to see hurried insider buying taking place at Synergy. Synergy's Chairman, Gabriel Cerrone, raised a lot of eyebrows by purchasing Synergy shares worth $317,250. Mr. Cerrone currently owns 631,230 shares at Synergy and has been the company’s Chairman since July 2008. The company announced a net loss of $9.9 million in November 2012 and total cash of $37.4 million. Synergy is a relatively small company when compared to its closest competitor, Ironwood, which has a market cap of almost $1.1 billion.

Moreover, the fact that Mr. Cerrone is buying shares at Synergy instead of selling them suggests that he is hoping to make a lot of money in the future. That hope stems from the success of plecanatide in clinical trials. Plecanatide has the potential to tap into a largely underserved market. Sales could potentially reach $2 billion annually.

Conclusion

At the moment, Synergy appears to be a promising investment candidate. Investors looking for exposure in the pharmaceutical sector should consider buying this stock.

The article Will This Irritable Bowel Syndrome Drug Be a Cash Cow? originally appeared on Fool.com and is written by Jordo Bivona.

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