The question of New Chemical Entity (NCE) status for Amarin's (AMRN) prescription fish-oil pill Vascepa was finally settled on Friday. Like all of Amarin's recent regulatory decisions, this one also went against the company.
The FDA finally told Amarin that Vascepa would not be granted the five years of market exclusivity that comes with NCE status. Instead, FDA said Vascepa was a New Product (NP) entitled to three years of exclusivity.
The "NCE or no NCE" question has been hanging over Amarin since before Vascepa was approved on July 26, 2012.
The product's market exclusivity now expires on July 26, 2015. After that date, generic drug makers can seek FDA approval to make their own versions of Vascepa. Amarin will almost certainly sue any generic drug maker who files and will receive an automatic 30-month extension of Vascepa exclusivity. Amarin believes patents on Vascepa, some of which extend out to 2030, protect the product beyond the expiration of market exclusivity.
Amarin may never face a generic challenge to Vascepa because the product's current sales are so small. The company is expected to report fourth-quarter and 2013 revenue of $11.2 million and $27.38 million, respectively, according to S&P CapitalIQ consensus estimates.
Analysts have Amarin growing Vascepa revenue to $71 million this year and $115 million in 2015.
To put those estimates in perspective, prior to Amarin's approval, the Vascepa consensus sales estimate for 2014 was almost $450 million, according to S&P CapitalIQ.
More than the lack of NCE, Amarin's biggest problems is its inability to market Vascepa to the broader swath of patients with mixed dyslipidemia -- the so-called "Anchor" patient population. As those who have followed Amarin are well aware, an FDA advisory panel voted overwhelmingly to recommend against expanding Vascepa's label until the company produces data demonstrating improvement in cardiovascular outcomes.