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Not sure but most of trading is program trading so if the momentum is in Bio stocks other bio stocks will trade in tandem. So even if it is not in the actual IBB it still may trade similar and it has in the past.
Misleading chart, at 10:15 AM IBB was basically unchanged for the day and AMRN was up a dollar, as program trading became more prevalent as volume dropped you get some similar movement but the stock did not make the large volume jump on program trading or Earnings release.
Let's also go back to the minutes before Novartis rumor in the 17's and compare to IBB, this movement since Friday is almost all BO speculation related, nothing else has happened since Friday that would move the stock marketwise or otherwise. The rumor clearly has legs, does not mean they consummate a deal but they are talking deal.
Might be true but this run started with BO rumor and unlike PFE rumor has continued to run. If street is hearing deal decision is close like this guy is supposedly hearing and Monday comes with no deal I could see stock taking a step back. I'm in long term either way but just a thought in terms of short term direction.
FYI, there is a guy on stocktwits called the thebobbyrotten that has been posting for awhile details from "co-workers" stating Novartis and PFE are both bidding on AMRN and both offering about $32 per share in stock. Also has stated AMRN was voting on the deal today. He has stated he is certain the offers have been made, but uncertain on Amarin's acceptance or not. Has also said not a bidding war at this time.
Everyone here agrees is low # and would say no but if that pushes closer to 40?
I pass it along for those that want to follow him, understanding it is the internet and everyone knows something but he seems interesting to follow anyways. If word is out that BO vote is that close to happenning will be interesting to see if price drops if by Monday no BO announcement.
I believe that's why the deal is "complicated" as the rumors have suggested, there would be a minimum payout and then subsequent payouts at milestones, BP would also feel they can maximize the chance of getting FDA approval the way they want, also maximize ramp up, maximize insurance coverage, waiting until next year is definitely possible from AMRN angle as relieves overhead but the odds are extremely high of FDA label expansion for Vascepa so for BP to lose a year waiting for overhangs to go away when a realistic analysis shows that overhang is not likely to have a negative effect seems not smart.
They don't need to know peak sales with milestone payments, but realistically BP knows there are billions in sales potential and they believe they can get to peak sales faster the sooner they get control.
You might be right, there is a lot to overcome, thus the deal being complicated but I'm convinced they are talking and trying to make it work, they may find there is too many differences on how much and what the milestones need to be and it very well may wait until after FDA approval, but at that point AMRN may see such script growth they don't want or need BP, or Novartis now finds several other competitors to compete against.
There is risk for Amarin to wait, there is risk for BP to wait. An up front payment (Say $10 Billion) with another $10 billion with full label expansion and then future payments up to another 20-40 billion based on sales milestones is all possible.I just made those up so throw in any #'s you want, no idea how they come to figures which is why this deal is so complicated.
The fact he addressed it before Q&A is not something I believe he has done before, I know the rumors are very recent so probably getting ahead of the questions but could easily waited until a question came up and said we don't comment, I thought it was slightly telling and led me to believe they are in negotiations today and they are not new negotiations. My feeling is the Novartis rumor was more true then the PFE rumor and where I was 90% sure no BO before FDA approval a few weeks ago, now I would not be shocked if it happened in March.
It followed that by quickly dropping down $2 the next few days and then settled up $1 from there so if similar pattern holds would hit 18's next week and settle in the 19's, of course there are earnings and CC next week and what is said and happens will go along way to whether price retreats if no BO announced.
I think the rumor is odd in that is says it is far along but no idea if they will end in a deal. If rumor is true than maybe DD had been completed, they are interested but not at asking price. But wording still seems a bit odd. I also have a hard time believing someone with knowledge of the situation is giving this info to a website. These things are normally so tightly wrapped. I believe many BP are interested and kicking tires on this, just don't see urgency from AMRN, win the lawsuits, get FDA approval, line up partnership, get scripts in hockey stick mode and sell from more strength, though I suppose if there are future payments on milestones may factor into selling now instead of later.
With the recent script momentum, FDA approval coming, it's got to be a blow away offer to sell before September-ish.
Many of these committees take a long time to update guidelines, I'm not privy to this particular committee that passes these guidelines but I know in other industries it can take a year from proposal to guideline approval.
There is generally a lot of lobbying going on when they are initially proposed, it is very likely Vascepa results were not out when the new guidelines were first established, it then generally goes through comment periods and a voting period which as mentioned can take a long time to approve.
Interesting read, basically it took almost 4 months from the initial solid offer to an agreement. Not sure there is any average on these types of deals as they actually started discussions and abandoned them in 2017 but you can see the type of detail and time it takes to come to a deal.
I've been of the idea any BO happens after FDA approval but also know management thinks they can GIA long term if they need to and expect they would be very successful.
FDA approval is when things get real interesting all the way around, hoping for expedited review to get to that sooner. In the interim will continue to sell short terms calls as I just don't see someone giving an offer AMRN would accept and I don't see AMRN taking an offer when they can de-risk some after FDA approval and be in a better negotiating position. The other catalysts before FDA approval seem less likely to move the stock in a big way.
The $18 area, where the raise was done, is a big ceiling right now, breaking through that would make $18 a very solid base of support.
I agree with most of what you say. I don’t believe AMRN is going private but the same thought process that occurred in the private buyouts I have been a part of would apply to a public company. The board and the large investors like the Baker Brothers have a lot of say in whether a buyout happens.
I am normally a horrible short term investment but an excellent long-term investor. I plan on holding this for several years but realistic with the fact that a buyout could happen. I am also realistic and that it may be go Alone for the long term as well. The main point is they have a once in several decades drug and investing now Will pay dividends down the line. I have no problems waiting it out. I do think it’s realistic to think that a buy out may happen down the line. Either way I think investing now is a long-term homerun.
If they were not bought before or right after AHA then I expected nothing to happen with that until they reach label expansion. I've been involved, as an insider, in 2 private buyouts with private equity, the second time, management and owners had no intention of selling, growth was excellent and accelerating, however, the unsolicited offer was too good to pass on for investors so the board voted to sell.
Once Amarin starts checking off potential pitfalls, label expansion, patent suits, competitor trial results the offer from BP might be too big to pass. Otherwise, I agree, management could turn this into a larger company, add a pipeline with the cash flow and make a lot of money and reputation/legacy. Though the board and large investors will have more say than management on accepting a BO offer.
If management executes well, regardless of GIA or BO stock will be much, much higher in the future, if they execute poorly and sales ramp too slow, they can still exit with a BO in a few years and let BP get Vascepa to its full potential and still make a decent return for shareholders. Vascepa is to valuable.
There does not seem to be many people that post with that opinion. Seems most people believe a BO will occur, some sooner, some later. A lot of political talk on this board and complaining about stock price, trying to get some actual AMRN talk on the board, I would think the next post if think GISA for the long run is what is the expected path, will they triple sales force after expansion, will they go the partner route in US at some point if no BO. Every year that ticks off is a year closer to 2029 and generics, do they try to buy others to get a pipeline? Lots of discussion ideas out there but I guess we can just go back to politics.
The next time someone changes their opinion (which they all think is fact because "everyone I know believes what I believe) because someone posted on a internet message board it will be the first time that happened in history. Confirmation bias runs the country, please give it up mon this message board.
Onto Amarin, based on 5 years out peak sales I believe that Amarin cash flow can pay for the current market cap sometime around then. What are the risks in 2019? What do people think the stock will exit 2019 at assuming no BO?
If they get standard review and not expedite what's everyone think sales will be in 2019?
I see the mentioned $1 billion in sales that can be supported with inventory, do you think when the company has $500 million as estimated sales people will trash the stock because everyone now expects $1 billion because JT said $1 billion several times despite his caveat this was not a sales estimate?
Is there anyone here that thinks in 3 years Amarin will be still GIA?
Some of the stock risks:
-FDA does not approve expended label or asks for more info
-Competing study by BP equals Vascepa results
-Sales do not ramp well before label expansion due to insurance issues, poor new sales people lack of sales #'s and established doctor contacts
I'm not rating the risks just listing everything possible, anyone gt more to add to the list?
All gaps don't get filled
That's why expanded label is so important to happen as soon as possible. It's all going to work itself out once they get that but the ramp up in the interim is going to be held back by this issue.
Looks like they end 2017 year $220 million, so $270 million would have been expected next year with no sales force increase or RI results.
They need to exit Q1 around 60K scripts to hit $700 million assuming a late in year approval, expedite approval would change expectations greatly thus I don't see how they give forecast until they get that answer.
We will see how scripts exit Q1, we really can't tell how the ramp up will go and how big a hit the insurance coverage will cause as they ramp.
Keep in mind with the discounting they do they get 1/2 of what they can get without discounting, so once they get expanded label and get to 2020 and get better coverage they get an instant boost to revenue.
I took the exact same EPA, I took it a few years ago, had the heart palpitations, thought it was related to diet change, stopped all changes including the EPA pills and mostly went away. 2 years later started taking it again, within a month I had palpitations. They did heart monitor for 24 hours, said benign palpitations.
Stopped taking it, went mostly away, when I say mostly I was getting them a couple times a minute and now I get them a couple times a week. So definitely not something I can take. I don't really need it, was just a supplement, figured couldn't hurt.
I don’t think anyone in the world believes AMRN could ramp up sales like BP, that’s not a fair comparison. 2,000 script increase was very good increase, the market share spread grew considerably, these were excellent numbers that gives them a trend to 700k next year. Let’s see trends continue.
What other company that GIA andfailed had a monopoly drug? The comparisons to others are a reach.
The new reps are barely out on the road, they had 18,000 applications, I highly doubt the all suck based on your brothers one opinion of his particular rep.
Lipitor was on market a few years and Warner Lambert was not known for developing drugs but because it was a great drug in 3 years it was 3.7 billion despite other statins beating to market and THEN they got bought out. I doubt they get 90 billion if they sold after approval.
That’s the last drug that was similar to Vascepa in terms f being safe, effective and have a market the size it does.
These GIA vs BO discussions are a year early. Get on label, triple sales force, do 2 billion in 2020 and sell out where BP still has a 9 year run with it. Get 60-80 per share vs 30-40 now, that’s the scenario BB and JT are shooting for, way too early to judge the execution based on one sales reps visit.
While that is true, the amount of additional scripts needed at higher #'s to equate to 4% is much larger. 1360 scripts is 4% more now, on 100K scripts that's 4,000 scripts needed.
I think it is very hard to tell where scripts will be end of Q1 2019, They need to be double what they are now, at end Q1, to get on pace for about $700 million for FY 2019, of course, expedited review and early label expansion makes a quicker ramp at end of 2019, but assuming normal review there will be only a small window of expanded label in 2019. I think $700 million is my reasonable goal for 2019 and curious what the company will come out with for 2019 revenue estimate. I don't believe estimates will be announced until January (last year was Jan 4), maybe not even until the Q4 Conference call in early Feb as it is possible, though doubtful, they may delay to gather more data in January with full sales force out there.
2019 Outlook is probably the next press release worth reading that will come from the company.
Any guess as to when that would be expected to happen, get to the point where 100% certain approval? Is that like July based on current knowledge?
The drop timed up with markets steeper drop, low volume, just program trading, basically nothing of value can be gleaned from today's trading, at least not so far today.
I think cost can be a big one for many, also Generic Lovaza is prescribed for a certain indication and if it is doing what it was prescribed for then attitude is why switch?
It'll be easier thing to do once insurance coverage is more equivalent. There are many where that is the case currently and for those they should be switched but I believe uninformed is correct, that's why there are large sales forces, to educate. This will all take some time, with expanded label and then a much larger sales force I would expect all these things to align for 2020 and you'll see a much larger shift than the gradual shift you will see the next year.
That is unrealistic, You won't get P/E that high, ABMD is a different company, has a pipeline of forward advancement, is basically a manufacturer.
Also 50% is likely high, most companies in industry end up around 34% not factoring R and D, AMRN will need to use more money than you think to have a future towards the end of the one drug, R and D spending will go back up. AMRN will also start paying taxes which will reduce cash flow and NI.
REGN is probably a better comparison but AMRN is hard to compare to with 1 very large drug, constantly fighting patent suits, having to figure a path past generics in 2029 at least.
1.912B Revenue
1.529B GP (No more 10% payback)
20m R+D
550m Selling/Admin (Double 2019 sales force)
959m GP or $669m with 34% Net Income
Using 25 P/E of REGN you get $63.65 stock price and $44.38 in 34% scenario.
If they continue to grow after that the price will go up from there, They should get $2 billion in 2020 assuming by end 2019 label is expanded so the 44-63 price to me is end of 2020, but I still expect a BO $60 or higher in early 2020 IF everything goes as we all hope.
$30 billion BO, just by itself, is a job risking move.
It is all Risk/Reward. Peak sales estimates have ranged from $1 Billion to $13 Billion. Sales are currently $230 million.
You have FDA approval, competing study finishing in 2020 and patent lawsuits going on as perceived risk factors.
So if Amarin won't accept less then $80 per share or $32 Billion how do you justify that now as a CEO of BP with the market pricing the company at $7 billion. Pay 6 times current market cap? BP Shareholders don't understand the science, the potential here, they just see an overpay. Sure you might pay $40 a share max, you can explain a double on price to shareholders but highly unlikely Amarin accepts that.
So, end of next year, FDA approves expanded label, sales are $700 Million but trending toward $2 billion in 2020 due to expanded label, maybe patent suits have moved along enough to add more certainty the patents will hold, stock is closer to the 40-50 price targets out there, you offer $32 billion then because now risks have gone off table, Amarin knows they may not grow it nearly as fast as BP could and will need to triple work force to do so if GIA after FDA approval, so $32 billion is still acceptable to them but NOW BP can justify that, they can estimate peak sales much higher and ROI within a reasonable time frame. BP CEO cannot sell a good ROI buying the company now for $32 billion, investors would not buy into the estimates.
The #'s above could be changed, I have no idea what AMRN would take so that is just a guess but the point is I believe the price AMRN would take is much higher than a BP CEO and board could sell to their shareholders as a fair price.
Since they could kill a deal due to the large # of votes they have they would be, by default, approving one as well. The board gets to the point of accepting an offer, before they do it the first call is to BB. BB is also known as active investors so they will want a say and AMRN would have to give them one.
I think odds are low of BO before FDA approval. They can Maximize BO price after showing revenue closer to $1 billion and FDA label expansion. It seems Europe partner may not happen until later also though they could do that at anytime it seems like they are leaning toward after submitting to FDA or after FDA approval. But this ha at least a 40% chance of happening before then IMO where a BO before FDA expansion I put closer to 15% chance.
Knowing how these CEO's and boards usually think it Wouldn't make too much sense for BO to happen before, if I was CEO of BP I would go for it now and get a better deal, however these BP CEO's all come from same business school. Having been through multiple private BO's and through many board meetings, the way they think is all the same. It would take a forward thinking CEO to do a BO at a price Baker Bros and the Amarin board would accept today, just not to many of them are forward thinkers, but within a year they will be OK to make offers at Amarin acceptable price.
It seems like the body is very detailed and the cash received lines up exactly. The statement regarding underwriters will sell on the market at time to time is a bit confusing, I would think they would have set buyers that would not go through the market but maybe everything goes through the market, hopefully someone with more knowledge can expound on this
Not sure how to read that, the item you list is to calculate registration fees but body says 17.575???? Maybe I don't know how to read it but the math on cash received also comes to about 17.58?
The underwriters have agreed to purchase the ADSs from us at a price of $17.575 per ADS, which will result in approximately $195.3 million of proceeds to us, before offering expenses, and assuming no exercise by the underwriters of the option described below. The underwriters propose to offer the ADSs from time to time for sale in one or more transactions on The Nasdaq Global Market, the existing trading market for our ADSs, in negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices, subject to receipt and acceptance by it and subject to its right to reject any order in whole or in part. See “Underwriting.”
We have granted the underwriters an option for a period of 30 days to purchase up to 1,666,666 additional ADSs. If the underwriters exercise the option in full, the total proceeds to us, before offering expenses, will be approximately $224.6 million.
P/E is normally much higher for a company showing such large growth rates, 28 is probably a better # than 15. If at $3B then you would expect $4-5B next year after and then peak at ??? $7-8? so by that point 15 P/E would make sense but double the eps thus $100 per share.
However, how far until 2029 generics at that point...what have they done with all the cash flow (buy back shares, create a pipeline???), so many unanswered questions to value but they get to BILLIONS in sales and stock will be much higher.
Who we kidding, if they get to $1 billion pace end of 2019 with FDA expansion BP will buy them and AMRN will sell as BP can make the peak # higher much faster.
I don't see anything concerning, Most of open interest were bets before results, recent volume seems to be hedging or straddles and mainly option plays on volatility and not on any news event. Seems hard to believe someone has some inside knowledge of black swan event that could drive the price down huge yet at the same time the general market had nobody aware of this.
If you have the funds selling puts AND calls makes a lot of sense right now, if afraid of BO risk then cover the sold call but high premiums still there for volatility.
Personally I sell options, rarely buy but these volatile stocks, while they are being volatile open up lots of potential options.
E.G. if bullish Sell Feb 14 Puts for $1.70, buy Feb 22 Call for 1.65, stock breaks to new highs by then, say with submission to FDA and FDA says will expedite, stock hits $25.30 you just doubled your money on call and made 1.70 on the Put. Odds of stock being below 14 I think are slim but if it does end up there you own the stock at $13.95 (14 minus the 5 cent profit on options sole/bought), you can then hold the shares or sell covered calls at 14. Odds are high you will make money even if it is only the 5 cents.
There are a ton of ideas you can do if you are bullish, bearish or neutral but the key is having high volatility so the time portion of the option is worth a lot in a short period. Not unusual to see high option activity in a stock that is so volatile recently.
I don't know if the fidelity $18 price email someone received reflects the accurate price or not, My guess is the shares have been placed already and we will hear by end of week that it is closed, It is possible they wait until the underwriters execute the extra $30 million which could be as long as 30 days but I think that will also happen this week. So hopefully AMRN tells us the final result at the end of this week. Dilution wise, long term not a big deal either way.
The 5 strike is too far away for that to move much even if down to 12-13, especially since that many puts bought would have been bought near the ask price and would be selling at the bid or lower and there would be very little bids available unless it was near 5, the odds of getting out of that position if stock is not near $5 is rather slim which leads to a more likely hedging strategy. Since is same expiry as the 21 strike play I would guess there is something related to that, some mathematical reduction of risk, maybe determined at that level whatever they were doing would start to cause a massive loss? If they wanted to play options volatility for a profit and thought was going to 12-13 much better Puts to buy for much better returns.
You would even make way more money at the higher strikes, say the 6 strike, until stock was under $4 it would make more then the 5 strike.
There is no logic to this trade being a straight short play or a play to make money off the options, it has to be part of a larger hedging strategy.
With expanded label by end of October, I would expect a big quick jump in Q4 with expanded label, maybe 50-100 million bump so timing of that could make the sales number as low as $600, but expedited review, maybe gets it to $800. I think if they don't hit in that range then they did not "execute" as well as they should have.
Yes, insurance will still pay, harder than if on label but not the main issue. They can steal Generic Lovaza share in current population. Issue is that until on FDA label the 400 reps cannot get the word out to everyone and getting more insurance companies to get it on a better tier will be harder before FDA approval but there is enough coverage on insurance now to not effect things much considering the smalls ales force and the lack of expanded label.
They said they will reach twice the amount of doctors with increased sales reps.
With just the current trend before results you would expect close to $280 million in 2019, you've seen 15% boosts after first results and should see similar from details released so 364 million is an "in the bag" # for 2019 IMO and then you add the 2 times doctors and extended sales force and off label scripts and the fact some of Q4 will have the indication ON label and seeing $700 million next year should be expected and would think in January they would give guidance in that range.
After that they should triple sales force (or more), have it on label, advertise to everyone under the sun, add European partner and then you would see multi billion in sales as early as 2020, maybe not until 2021 but no later IMO. If GIA. I personally expect a BO after FDA approval.
From the filing for the raise it appears the standard review is what they are counting on. So an expedited review would be a positive catalyst if it happens. I wonder why they are counting on a standard review? Anyways it appears it is closer to 10 months standard review total.
The REDUCE-IT study was designed under a special protocol assessment, or SPA, agreement with the FDA. We intend to submit an
sNDA to the FDA in early 2019 seeking approval to expand the label for Vascepa based on the cardioprotective effect of Vascepa
demonstrated in the REDUCE-IT study. The FDA’s determination of standard or priority review will be made when the sNDA is
submitted. At this time, we are planning for a standard review with potential approval anticipated in late 2019.
He did say in the interview that there was the possibility of waiting for FDA approval before a European deal. Today he also stated big jump in scripts once get FDA approval.
I think it is pretty clear they are GIA up to FDA approval, remove that remaining overhang and offers will flow in. I think they believe they will be so much better off after FDA approval and today's raise gets them to that and beyond.
I don't think they can get to $1 billion next year based on his comments, $700 million seems about best case scenario. I guess depends on exact date of label expansion.
Of course things can change if a BP CEO gets smart and aggressive early but good time to sell some covered calls and believe that's the way to play this for the next 6 months.
I can't imagine many were seriously looking at this call as something meaningful, I think the moderator, instead of questioning MO should have asked about the raise. Most Institutions are in for long run, not going to be swayed by this call, dropped below 50 day moving average triggering more sells since most trading is computerized(50-60%) and even more so with more volatile stocks(up to 90% of trades) I don't put much of this drop on disappointed investors related to this call. Also gives shorts reason to attack stock. This is down too much for such a small raise.
I think JT will be better on next call, seems he finally learned to totally bash MO storyline, remember the first interview about it? He seems to learn from his previous interviews.
Next time he needs to learn to not downplay 2019 growth, last call he said expect effects of AHA in January not before, this time he said expect huge growth after FDA approval but left out the fact he still expects accelerated growth in 2019 before that, just not as big. Made it sound like no real growth until FDA approval, he will get feedback on that and next time I bet you'll see more positive notes from him on doctor feedback, increased positive vibes from field, more than double the sales force etc.
Based on that info AMRN is expecting and expedited review, otherwise approval would move to 1Q 2020 with standard review?
Is there a point in the process where an Adcom happens, if so how long before actual FDA decision?
I did see a post stating someone got $85K plus possible bonuses, have to figure 20-25% for benefits and taxes, I think $100K is a solid # but you also have to factor in the increased travel cost, car reimbursement etc... but I think $100K is a reasonable number though if sales go well and bonuses are passed out it would be higher. It's possible that person was on the high end but I think on average $100K is a good # to go with and always best to overstate than understate. You also have to factor the additional sales force will require additional HR hires, additional sales support etc. so there are other costs than just salary/bonus/tax and benefits.
I expect $30-35 million in 2019 in sales reps costs but I then expect a huge ramp up after FDA approval if GIA, long term would expect peak sales above $5 billion+ and up to 2,000 reps but how long takes to get there unclear.