Update on Amarin Corp (AMRN)

Today Amarin Corp (AMRN) announced that it received notice from the U.S. Food and Drug Administration (FDA) that the FDA plans to hold an advisory committee meeting (AdCom), tentatively scheduled for November 14, 2019, in connection with its review of the pending supplemental new drug application (sNDA) for expansion of Vascepa. Surprisingly FDA did not send this AdCom which is usually done within 55 business days. In other words, it should have been done by mid-late July. However, today the CEO mentioned in the conference call that FDA advised not to disclose it immediately. That's strange! There could be many reasons.. Well, as I pinged to my WhatsApp group, in the after hour AMRN stock was down 23.6%. As I promised, I have analyzed sharing my thoughts.

At this time one can speculate many things, I am sharing some of my thoughts:

• Amarin submitted over a million page of documents to FDA for their review (yes, you heard it right - m for million!) It obviously takes time to review before giving any approval.

• FDA could have thought to make a final decision without ADCOM but may have decided at last minute and choose to go with routine process "ADCOM" review through panel looking to the significance of the drug.

• Also there may be many other games being played to discourage Amarin (AMRN) and it might be tempted to sell the company for cheap price to a bigger pharma/biotech company.

• The scheduled Adcom meeting could be for its extended label approval. Since the sNDA submitted by AMRN was an "open" label based on RIT trial results, it is possible that FDA experts wanted broader input from ADCOM experts regarding specific indications. 

• Per AMRN based on FDA notification, FDA is "silent about approval date" which was scheduled earlier for 9/28/19. As of now, there is no change on that date which is little strange. What it means is that, FDA may still act on approval date of 9/28/19 as part of their Priority Review for partial label approval. Subsequently, there could be approval for broader indication based on ADCOM experts panel view. 

• Analyst View: As the Analyst pointed out, "It's not totally surprising to have a panel although we didn't think one was likely. It's reasonable to have a drug this big discussed in public forum; hence, while there is some new risk today, we see the pullback as more than reflecting that now, and as a buying opportunity since approval is very likely." 

My View: First of all, I do agree with the above analyst view. As the CEO said "good things do not come easily". The drug has humongous potential to be one of the greatest selling drug ever, once approved. The label drug is already approved and selling very well. The company had terrific sales growth last few quarters and raised the guidance as well for the coming quarter. Because the drug works as simple as that. Also, as I understand it's being tested for not only cardiovascular problems but for diabetes and other critical illness which I would not like to speculate on this blog.

Today what happened in the after hour is a jolt and certainly it's not amusing news for the investors. And obviously, it's a jolt to me personally, as I have told this is one of my major position. I am disappointed and it's a set back to my portfolio and all those who are invested in Amarin shares. But after many analysis, I am no more panicked and thinking to add little more position tomorrow morning as it may open where it left in the after hour trading. It may go little further down and then it may recover to certain extent. However, I do not expect too much for next couple of months till the ADCOM meeting. After the setback, the stock should start recovering when there will be little more clarities possibly in next few weeks. As I had written in my February blog (se below):

• Cardiovascular Death Reduced by 20%

• Fatal or Nonfatal Heart Attacks Reduced by 31%

• Fatal or Nonfatal Stroke Reduced by 28%

• Urgent or Emergent Coronary Revascularization Reduced by 35%
• Hospitalization for Unstable Angina Reduced by 32%

This is huge! For further details, you can also revisit my February 2019 blog by clicking on Blog Archive link at the end of my blog. 

Conclusion: Fundamentally, nothing has changed rather it has gone better. It's a temporary delay and I view it as another opportunity to add some more equity. I may be wrong here, if so, I am willing to take that risk but if my perception is right then the story is different. Only time can tell. I do not want to pump anybody to buy/sell, rather what I am writing is solely my own opinion. It's up to each investor to strategize and take decision based on their financial implications and risk taking capabilities. Thanks for reading!

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Disclaimer: This blog is meant to provide my opinion only and these are based on my own analysis and assumptions. This is NOT a recommendation to buy/sell any stock. Please take the decision with your own risk. Please