Amarin Corporation plc (NASDAQ:AMRN) is Playing the Next Game

The story right now for Amarin Corporation plc (NASDAQ:AMRN) continues to be one of our favorites. It represents the best of the dream that simmers underneath the surface of a private biotechnology marketplace model that has access to capital market investment. By now, most readers will know the story here, but for those who don’t, here is the briefest of summaries.

AMRN shares have been rolling on momentum ever since the announcement last September of its dramatically successful Reduce-It trial, which showed remarkable reduction of the risk for serious negative cardiovascular events for patients pre-screened as “at high-risk” for such events. The study evidenced sharp reduction in heart attack, stroke, and cardiovascular death – by as much as 25% over years of data for thousands of patients in the study.

Amarin Corporation plc (NASDAQ:AMRN) released the original study data last year, igniting a massive rally in shares. But some controversy has defined the story ever since, keeping the stock rangebound, but in an increasingly ascending triangular range, possibly portending a breakout yet to come (which is our assumption, quite frankly).

As for the controversy (and, again, most of you likely know this), the placebo arm of the study employed mineral oil, which presents some potential for skewing of comparative results – though even skeptics at this point can only make a case that Vascepa has a strong preventative impact at worst.

The Next Game

The game now is in many ways coalescing around a PDUFA date assigned for late September of this year (9/28/19), when we will find out if the FDA is willing to grant an expanded indication on the label, including assignment for residual cardiovascular risk reduction in patients with statin-managed LDL-C cholesterol, but persistent elevated triglycerides.

In a recent shareholder update, John F. Thero, president and chief executive officer of Amarin, stated: “We expect earlier approval of an expanded indication for Vascepa to lead to faster improvements in care for millions of patients with residual cardiovascular risk after statin therapy. These patients will be the focus of our planned expanded REDUCE-ITTM promotional efforts. We are very pleased that the FDA has accepted our application and granted it priority review. We believe the unprecedented REDUCE-IT results position Amarin to lead a transformative change in clinical practice for preventative treatment of cardiovascular disease, the leading cause of death for both men and women in the United States. Our plans to significantly expand promotion of Vascepa following label expansion are being accelerated to reflect the upcoming PDUFA date.”

An expanded label would allow doctors to prescribe Vascepa as a preventative to patients at risk of a cardio event.

The fact that the PDUFA date has already been moved up by four months is likely a very positive indication. That happens when the major benchmarks needed to make a decision are seen as increasingly well established – ie, the date for adcom review isn’t going to be moved up when major hurdles of proof remain outstanding.

From here forward, the point for investors will be “How much?”

When the take-out negotiation gets going, how can the AMRN team stack leverage on their side of the table? The big factor, as we see it, is going to be about the degree to which they can show an ability to capitalize on the enormous potential at market for Vascepa without the larger marketing budget and go-to-market machine of a JNJ, Amgen, Roche, Merck, etc.

In other words, it’s always about who needs who more. If AMRN can show the big players that it can manage without them, the deal will swell.

The fact that doctors have started to prescribe Vascepa ahead of the label expansion is an enormously promising start.