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Again guys, the big deal here is to GET the injunction. If we get that, the plan SHOULD be to extend the trial as long as possible for 10 years if possible. Who cares about paying the profits for marine? its tiny $. They can't go to court and argue the market is bigger than it really is, whereas if they actually launch, they can backdoor reduce-it. This nonsense about it taking time is silly. Pray we get the injuction and then it won't matter if it takes a long time...
And according the the PR that is what is going to save Amarin's bacon for the entirety of that appeals process[img][/img]. Get an injunction against generic launch pending appeal and post the bond on the "lost profits" since it can ONLY encompass marine (trigs above 500). Drag the appeal for as long as they can. We all know the entire trial was to get marine and backdoor reduce-it. Who knows...they may even win the appeal?
I'm not sure where you got the idea they asked for a label w/o statins.
https://www.fda.gov/media/132477/download
Page 47 :
"The applicant is seeking an indication for Vascepa as an adjunct to statin therapy in adult patients with elevated triglyceride levels (TG >135 mg/dL) and other risk factors
for CVD, but the trial inclusion criteria and data do not appear to support such a broad
population. "
In my opinion the FDA's issue is this:
"The applicant’s proposed indicated population is notably silent on several issues including appropriate patient age, presence of established CVD, presence of diabetes in patients without established CVD, statin intensity, and resulting LDL-C levels on therapy."
***The trial had pre-specified requirement for LDL <100 and JT wants a label that doesn't have specify the level of LDL. They are saying, if LDL is above 100, statins should be used to get LDL below 100 before using V.
Page 48:
"In summary, the trial population represents a higher risk group than the proposed indicated population, encompassing patients with diabetes and additional risk factors, and hypertriglyceridemia despite optimized statin therapy. There is no evidence in
REDUCE-IT that AMR101 is the appropriate therapy in lower-risk patients who may have elevated LDL-C in addition to mild hypertriglyceridemia and who would benefit from
optimization of statin therapy first."
You guys agree?
JL, HD, AVI, or anyone of the heavyweights here- Can you give your thoughts on the wide disparity between the results in the US vs non-US for both CV death (-34% vs -5%) and Total Mortality (-30% vs +4%)? What could be accounting for such a large difference? Does the wide disparity create a statistical anomaly in the results? I could see the healthcare system in emerging markets as a contributor but Europe is a large portion of the non-US cohort. I'd appreciate your thoughts when you get a chance. Thanks!
I respectfully disagree that friday has anything to do w/ it. Recall that they PR'ed the marine cc for monday morn on friday right after the close.
Sometimes it is not what is said that is important but rather what is not said..
Today's press release:
This acceptance as a presentation of late-breaking clinical trial results is based on the ability of REDUCE-IT to address a critical question in cardiovascular prevention. The AHA has reviewed the design of the REDUCE-IT study, however, they have not yet seen the results of the study. As Amarin has guided in the past, topline results of this study are anticipated to be made public prior to the end of this month, September 2018. The AHA has not been provided any advanced access to the results of this study.
Notice they stated that the AHA has NOT yet seen the results of the study. Notice that it did not state that Amarin hasn't seen it like JT has said in the past. To push to present at the AHA w/ knowledge of the result is a positive as they would not be in a hurry if it was negative. Also, you can not provide advanced access to the results if you don't have it. You'd simply say we still do not have the results.
Essentially we know they have the results. The question is whether they completely understand it and that is the sole reason why it has not been PR'ed yet. I could be reading into something that isn't there or wasn't intentional but the way its written subtly implies they have it and by PR'ing their push to present it asap, reflects what is likely a positive outcome.
To fully understand how you can "collapse the box" you have to understand the dynamics of shorting. When you short what you are actually doing is borrowing the shares, and then selling it. To cover that short, you must buy the shares back and "return" them. Your goal should be to do it at a lower cost than you sold it at. If you acquire shares from the convertibles, you simply take those shares and use those to "return" the shares you originally borrowed.
Kiwi- I know your opinion is set in stone but the answer to your question really depends on your definition of "initial".
initial
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adjective
1.
of, relating to, or occurring at the beginning; first:
The "first" estimates were clearly the original design pre the addition of the extra 1000 patients....unless your definition of "initial" means something else...
HD- I stand corrected as your are the expert. My only point was the Kiwi could not be correct w/ his expectations of a 5.2% placebo event rate OR lowered composite rate due to higher intensity statins since they were tracking to expectations...
Kiwi- I'm not suggesting that the study will be stopped at interim. I'm just suggesting that you are off base with your expectations of a low placebo rate based on what he said. There are many reasons not to stop the study despite great results. If the study ends up being the first successful statin addon drugs, and it only took a little over a year to finish the study, it would make sense to see it through since is more definitive and less subject to criticism.
Bottom line is that you have written extensively about how the event rates should be lower due to higher intensity statins being used in RI and as much as I respect your opinion, one of your assumptions are wrong. Either placebo is low like you say and V just doesn't work or V works but MUCH better than the 15-20% you are guessing due to the event rates tracking to initial expectations. Let me know if I'm off base...
HD- I'm on the same page. We know initially, a 5.9% placebo event rate was the rate to achieve 15% rrr at that power 95% power... so we know no company plans for the minimum. They must have had a composite rate in mind that is inclusive of that minimum and likely a much more aggressive target.... All I'm saying is that the composite rate has met their initial expectations and within that composite rate we know they modeled at least a 5.9% placebo rate. If the placebo rate is as low as Kiwi is expecting, then now knowing that they have met expectations for the composite, V must either be futile or have a higher rate than placebo. Lets use the min requirements to meet the 15% rrr
5.9% placebo event rate/ 5.015% V event rate = composite rate of 5.457%
So if Kiwi believes the placebo rate is 5.2%, what must the event rate be in the V arm to make the initially projected 5.457% composite rate?? The V arm would need a 5.7% event rate...
Another theory that is out the window is that due to higher intensity statins, the event rate would be lower in both arms...since that is not possible w/ Steve affirming the initially expected event rates...
Thoughts anyone?
Kiwi- I no doubt agree with your comment on the problems in predicting event rates in CVD trials but we have been told verbatim that its as expected. Funny that you mention "I also pay far more attention to what Dr Ketchum says on the CC's , then the Ceo." Steve is not the CEO...
The quote I took is fact from Steven Ketchum (the same Dr. Ketchum you pay attention to) - Senior Vice President, President, R&D and Chief Scientific Officer and he has basically affirmed that the event rates have tracked closely to INITIAL estimates. Here is his full quote from the transcript:
"It's fairly remarkable how closely event rates in this study track to our initial estimates.
And as we have reported all along, the cardiovascular event rate continues to track to prior estimate. We believe this supports the assumptions we made about the target patient population, size and powering of the study, so we continue to take comfort in its steady progress."
Would you rather listen to what HC Wainwright who is guessing? or to Dr. Ketchum who has seen the data? Any thoughts now that you know the quote is from Dr. Ketchum from the last CC? Keep in mind he said initial estimates. To me, that translates to the 5.9% which was the initial estimate...
Kiwi- I am very curious about your position on expectations of seeing a much lower event rate due to the higher dosage of statins. We already know that the event rates have tracked to their "initial assumptions" per managements comments. Unless you believe they are lying, I take that to be a composite rate of at least 5.9% (since that was their initial estimate before the addition). If you want to, you can say it is 5.2%. This is the COMPOSITE rate. That means if V worked at all, the active rate will be lower than the composite rate and the placebo much higher in order to arrive at the composite.
Do you not believe Steve when he said "It's fairly remarkable how closely event rates in this study track to our initial estimates."? How would you interpret what he said? I thought his comment clearly implies the composite event rate is meeting expectations but maybe I missed something? I'm curious as to your thoughts...
SB
I hope you were not surprised by the cash burn during the first quarter. As we have seen the last two years, the first quarter has the highest cash burn. A lot of that is a function of timing. The expenses are not linear on a quarterly basis. The key is that they still expect flat SG&A vs last year which is approx 101mil and 30-40mil R&D. That's 140 mil burn that will get offset by revenues. The more revenues, the more it offsets. Like I said, even if they dont' grow scripts at all and have around 105mil in rev we are talking 35mil left at year end...if they get 120 in rev, then we are talking about 45mil+ left at year end.
I am not sure if you've done the simple math on it. See my post on managements guidance. Post # 79598 and 79608. I acknowledge Kiwi's point on whether management wants to be in a position of cash levels around 25 mil but if we assume same increase in scripts as last year for the rest of this year and 2017, they will NOT run out of cash. They'd get down to a minimum level of 25 mil at the end of 2017 but from there on, they will be cash flow positive... It gets them to reduce it results easily and I (maybe not management or the bod) think 25 mil is a good enough buffer.
Now, I also didn't include that 15mil note repurchase but that could always be pushed back or restructured...
Also, what if we get an uptick in script growth?? that's not entirely impossible.
In sum, they could EASILY wait till after the interim to address the issue and see where script growth is at that time. Let me know where I went wrong (aside from Kiwi's point)...
The key Kiwi is that i've basically assumed no growth in scripts. If they can grow revenues in the same absolute dollars as last year, they will not have a problem. They'd be sitting on 50 mil going into 2017 with only the RI expense in front of them. In addition are likely to continue to grow throughout the year leading up to RI. They can easily afford to wait to see how the rest of this year is going before they decide in 2017 whether raise more money.
We can extropolate that and see where they are at for 2017 year end
Period Ending 12/31/2015|9/30/2015|6/30/2015|3/31/2015
Total Revenue 26,633 21,483 17,707 15,933
Period Ending 12/31/2016|9/30/2016|6/30/2016|3/31/2016
Total Revenue 36,007est 30,857est 27,081est 25307 actual
Period Ending 12/31/2017|9/30/2017|6/30/2017|3/31/2017
Total Revenue 44,907est 39,757est 35,981est 34206est
Should that happen, they have burn rate of 25mil in 2017 leaving them w/ STILL 25 mil at year end and actually in a position to grow cash going into 2018 as the 45mil a quarter would pay for both sga AND RI cost from there forward. Why would u need to raise any cash unless you are talking about planning for post RI w/ bad results then its a different ball game. These are relatively conservative estimates considering that that we can now have an extra push w/ marketing via 1A and the fact that there is a positive relationship between market share and the ability to reach critical mass in terms of exposure...
Correct me if I'm wrong but the company should be just fine with respect to cash flow based on the numbers management has thrown out at us.
-SGA is expected to be flat w/ last year at 100 mil (on the PR)
-R&D is expected to be 30-40 mil (on the PR)
-Revenue is expected between 105-120mil (on the PR)
Keep in mind those estimates are for the year and the cost for sga and r&d is not linear.
So essentially they are saying 100 (sga) + 40 (high end of r&d) = 140 mil.
On the revenue side, you are talking 105 (using low end of expectations that essentially is saying they will not grow scripts since we are at 25mil this quarter already). Using their margin of 73% the net is 76.65 mil.
76.6 (net sales) - 140 (SGA & r&d)= -63.35mil
They started off year w/ 106.9 mil in cash so u net that and you have 43.5 mil left at the end of the year. Now they expect to be cash flow positive from operations at year end so all you have is the reduce-it expense. Is 43 mil to finish enough to finish RI? Keep in mind these are back of the envelop numbers that are very conservative. I've assumed basically no script growth from Q1. Assuming they grow scripts at same pace as last year in absolute terms, they will see 120mil in rev about 86mil net or cash burn of 53 mil leaving them over 50 mil. And who thinks they won't grow earnings throughout 2017? The simple answer is that so long as they grow scripts, there is zero chance they go broke before the completion of Reduce-it sans any unforeseen expense. Can anyone dispute this? all the numbers I got from the press release...
Also, those concerned about q1, the revs in last two q1 both also were less than q4 in previous quarter due to year end stuff. Same applies for the higher expenses in both r&d and sga in the first quarter.