Boston, MA 10/15/2013 (wallstreetpr) –
Amarin Corporation Plc. (NASDAQ:AMRN) is trying to understand the comments of U.S. Food and Drug Administration (USFDA)’s latest advisory. The USFDA has questioned the selection of mineral oil as a placebo, as well as questioned the effectiveness of Amarin’s sole drug Vascepa in the treatment of mixed dyslipidemia. The markets appear to have understood that the FDA has questioned the usage of the drug in treatment of hypertriglyceridemia, for which the approval was received in July 2012 from the USFDA. Amarin needs to answer these doubts in their conference call scheduled on October 16, 2013. Investors have been frightened by the wordings of the technical report and the company has yet to clarify, a step they should have taken immediately.
Vascepa is the sole drug commercialized by Amarin, and it is approved for the treatment of hypertriglyceridemia as an adjunct to diet. It is extracted from fish oil. The company is trying to expand its use in the treatment of mixed dyslipidemia. Considering that approximately 21% of U.S. adults suffer from this disease, the market size is very huge. The company is carrying out two clinical trials – Anchor and Reduce It. Reduce-It is a long term trial, and the results are expected only after six years. The FDA was reviewing the results of Anchor when they dropped the bombshell. They wanted to wait for the results of Reduce-It before approving the drug for mixed dyslipidemia.
Without a quick approval from USFDA, Amarin is in big trouble. Its cash reserves can last only for 6-8 quarters. With no other drug in the pipeline, no new revenue streams can be generated within such a short span of time. It will have to look for an angel investor to bail it out. Investors are worried about the future prospects and have dumped the stock. The share prices touched a new low of $4.50 per share before recovering slightly to close at $5.01, a decline of 1.57%.
