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Amarin: Prepping for FDA Approval Decision

If Vascepa is approved but FDA denies NCE status, Amarin shares fall below $15 (how about $12-13?) unless the company props up the stock with a boffo partnership or takeout.

Why can't Amarin sell Vascepa on its own and retain all the drug's profits?

Amarin could do that but Wall Street won't be happy about it. Let's face it, investors want Amarin to be sold soon after Vascepa's approval. Amarin's stock price sinks the moment CEO Joe Zakrzewski starts talking about launching Vascepa solo. Investors may not even be happy if Amarin decides to remain independent but sell Vascepa though a Big Pharma partner (like Pfizer!) even though the company could still do very well under this scenario.

Aside from the approval (expected) and granting of NCE status (hoped for), what else should investors be looking for from the Vascepa announcement Thursday?

Watch to see if FDA approves Vascepa with a broader label that includes reductions in triglycerides (TG) and apolipoprotein B (ApoB), the substance that carries LDL (bad) cholesterol throughout the body. An indication for ApoB lowering would differentiate Vascepa further from GlaxoSmithKline's (GSK - Get Report) Lovaza, which is only approved for TG reduction. This broader label would also further strengthen Amarin's patent position.

Another possible upside: Inclusion in the Vascepa label of data from the phase III "Anchor" study in patients with high TGs (as opposed to a label that only includes data in patients with very high TG levels from the "Marine" study.)

Amarin already plans to seek an expanded label for Vascepa to cover the larger patient population indicated by the Anchor study data. But if these Anchor data (TG reductions and no reductions or even decreases in LDL) are mentioned in the initial label, doctors may be more willing to prescribe the drug to a broader patient population immediately.

How big of a drug can Vascepa be if you include only the very high TG patient population from the Marine study?

Here's the simplest way of thinking about Vascepa's commercial potential: Glaxo's Lovaza generates sales of around $1 billion annually derived from single-digit market share among the 3.8 million people with very high trigylceride levels. Lovaza is not prescribed to the 36 million people with high triglyceride levels. Vascepa is superior to Lovaza.

Vascepa peak sales have the potential to be two, three or even four times that of Lovaza if Amarin or its partner/acquirer can grow the market for prescription fish oil. Positive results from the ongoing cardiovascular outcomes study would be a huge growth driver, and of course, the company must fend off generic competition for as long as possible, hopefully through 2030.

--Written by Adam Feuerstein in Boston.

>To contact the writer of this article, click here: Adam Feuerstein.

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Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.
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