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I don’t know what value we will see for either BO or CVR. $12-14 BO + $15-20 CVR would certainly work for me
I think nothing lost other than leverage
Yes I do agree with this.
Which is really strange as to why JT did not settle. Real head-scratcher that one.
Rather than having a fragmented market between several generic Co's ...AMRN would help Teva dominate ..and get royalties . Just looking at all possibilities ...still want AMRN to win the appeal obviously
It seems like from an investment perspective we need to hope for salvation in something other than the appeal. If that exists.
Nor did they catch the "slight of hand" when the generics stated that that Kura was not CITED" which plays into Du's comment that it was not CONSIDERED.
3-way? More like 10-way, eventually.
Lovaza is a small-time drug with declining sales right? How many generics do you think there are in the market?
If you guessed less than 5, you'd be wrong. There are 8(!) approved generics:
https://www.drugs.com/availability/generic-lovaza.html
Ativan has 11 approved generic manufacturers. Viagra (sildenafil) has 9.
If we lose the appeal, TEVA may be the largest, but in no way will they have the only slice of the pie.
ham. I might agree with you if they weren't already selling Lovaza . Its basically the same market ( over half of Lovaza was prescribed off label for CV risk reduction according to last GSK data I saw ) .......so they faze out G Lovaza and replace with G Vascepa ...same sales channel etc .
I mean of course it makes sense.
Billion-dollar BP's "mouthpiece" is a no-name hack who writes for an obscure website mainly focused on consumer-focused biotech (not business).
This is because BP is so poor they could not afford a mouthpiece from such low-brow establishments as the failing NYT, the WSJ, Mini Mike's Bloomberg or CNBC. I mean whatever have those idiots won, Pullitzer prizes or something?
But yes, a former hack for esteemed publication "TheStreet", this is the man BP needs to represent them.
They have Austedeo and Ajovy as well - which combined do nearly $1B of revenue.
Also do not be misled by REVENUE.
TEVA as a company doesn't need revenue - it needs MARGINS to pay for its interest expense (almost $1B annually) on $27B(!) of debt.
This is not a company that can aggressively push a low-margin generic drug. Not unless they refinance half of that $27B at 0.25% interest (and that is a longshot).
They would be more likely to buy AMRN outright and get Vascepa margins of 70% then go for generic vascepa, in what is likely to be a low-margin play (maybe 30-40% gross, at best) plus with significant SG&A expenses involved.
Amarin mgmt has no choice but to continue to build the market until a decision on the appeal is determined. Right now it should be business as usual for the sales team.
hampkypamky, Consider Goldman Sachs...My theory is that they are a
gatekeeper of sorts for BP. Why? they are involved in most M&A deals
which involve BP, for which they collect fees. Adam Feuerstein has a
role as a "mouthpiece" for BP. If you want to write me off as a
conspiracy theorist, go right ahead. (That term was created by the CIA)
Is BP a "Cabal" as you put it? These companies are all Trans-
national enterprises...they have no individual nation-state loyalties.
They do have interlocking directorships. They work together well
when it serves their interests.
The other issues are
1) supply chain of API and sales, distribution . Teva already has this established via their sale of G Lovaza
2) Teva's existing agreement with AMRN to pay AMRN a royalty if they enter the market . To my knowledge Hikma will not be paying AMRN any royalty if they enter therefore its in AMRN's interest ...if they lose the appeal ...that Teva enters .
3)AMRN has supply agreements / commitments already in place for API ( raw EPA ) and thus could supply Teva if necessary ...and supply of API will be an issue to really grow this market beyond $1B in yearly sales.
If Amarin loses the appeal ...then IMHO this is to big a market for Teva to allow a small generic competitor to dominate especially since Teva already has existing generic " fish oil " sales , supply , distribution structures in place
Wow, that was an unhinged rant.
This is a ludicrous conspiracy theory. BP isn't a centralized hivemind cabal. They spend 99% of their time trying to one-up the other.
Hell, they aren't even all based in the same country, from JNJ, PFE, GILD, Sanofi, Bayer and Roche all come from different places.
Even assuming Novartis or PFE was "punishing" AMRN, what stops JNJ or AZN from riding in at the last min to swoop up AMRN from their clutches at a 10% higher bid?
AMRN management sucks - lets just accept that, and the company is really unlucky.
If $10 and $1B for 40% of the company is a "fire sale price" what's $4.78?
Lets be real, this isnt going for $20 without an appeal turning things around. Ya'll need to focus on what's important - winning the appeal. Getting BP in our corner is what's needed whatever it takes, "fire sale" or no.
JT claims Robust interest for Vascepa in Europe. Great! JT should
negotiate a BP BO mostly on the basis of Europe's value. BP can also
decide the best move regarding the generics. If BP owns AMRN they can
place the limited(?) supply of Vascpa to wherever it makes the most
economic sense. If the generics are not stopped, BP can concentrate
on Europe and the rest of the world.
This would be the easy way out but very stupid if you think the appeal has any chance of success. You would be giving them a 50-50 shot at billions for almost nothing!
If I wanted maximum value, I would sell EU to BP for cheap (say $1B with royalties but have them purchase a large stake in AMRN at a high valuation, maybe $10 a share buying 40% of the company).
That sets a "floor" for the share price and it also allows them a big vested interest to make the appeal succeed as well as support Vascepa's continued development (one pill combo etc).
They can have a separate gentleman's agreement to purchase AMRN outright based on success or failure of the appeal.
Whal:
"IMHO in the end it wont be 3 generics ... Teva is a $16B a yr co with established " fish oil " supply and marketing chain since they sell G Lovaza. They will sell G Vascepa at a loss if necessary for a yr or two to drive the other generics out."
You're dreaming.
I'm a TEVA shareholder, both previously (and took a big 20% loss) and more recently (when Buffet bought in, and again at recent lows).
I believe in both AMRN (still) and TEVA but you're off your rocker if you think TEVA as a company is in a position to sell any drug (let alone a volume play) at a loss and subsidize 2 years to "drive other generics out".
https://www.ft.com/content/794dce40-4db9-11ea-95a0-43d18ec715f5
This is a company that has massive net debt and is just emerging from years of losses out of some bad management decisions. They have a good CEO (hopefully we turf out JT and get someone similar in) but one who's under immense pressure to turn things around and increase gross margins.
They are NOT in a position to do an UBER or AMZN and subsidize huge losses for years.
I thought the company had 380m shares outstanding, meaning $10B in cash/stock equals to around $27?
Anyways, $10B plus a CVR is a conservative, sensible offer for the acquirer. If you were the buyer - that's where you'd start too.
Assuming sales of 800m in 2020, $10B + CVR worth potentially $2B, 16X forward sales, is a reasonable starting offer.
I don't see a mega $20B sale for a company with revenues not even at $1B today.
A hostile takeover for a small-time company like AMRN is a bad sign. Especially for a CEO that isn't a super-dedicated founder in love with his business and has previous history of selling his previous company.
It usually means that either the BOD has pie-in-the-sky unrealistic expectations of what the company is worth, or nobody is willing to pay that much of a premium, so the acquirer is making a play to the shareholders at large with a sensible, small offer. Usually somewhere in between the two.
Or maybe they needed to diversify in line with portfolio guidelines, or needed the $ to invest in other potential opportunities.
One tute selling means nothing.
I swear this board is schizo. It's either going to the moon $100 or a <$10 stock sentiment.
Me, I still think this company is going to be bought out around $30-40 max. Patent case loss is a black swan so notwithstanding that.
See now you've gone too far.
I have read your posts and agree completely that some of the over-optimistic moonshot valuation numbers on this board are ridiculous ($50 and above in a purchase).
However, there almost certainly are buyers at the right price for this company.
This is a drug that with a tiny salesforce from a small-time pharma is doing $700m in sales this year and highly likely >$1B next year. With a BP salesforce this would double without breaking a sweat.
There will almost certainly be buyers for $10B or so (around $27/28), with performance payments potentially thrown in.
Some will read it and scoff at how "low" it is, but its a buyers market out there at high prices ($5B and above deals are rare).
So there is absolutely something on the table. Whether the BOD will agree to it is another thing, but making it out like there isnt is just dumb.
As someone with family in the area, you are sorely mistaken.
NK has more than enough support from the big boy in the area (China). They hardly need to get any from Iran.
In addition, they greatly benefited from tech from the former Soviet Union when it fell - same with Pakistan.
You're seriously going to chat sh1t about Dennis Muilenburg?
His track record:
BA Share Price, Jul 2015 (incoming CEO): $144
BA Share Price, Dec 23 2019 (resignation): $337
And that's a $180B mega-cap company.
If he took over tomorrow and trebled AMRN's share price (probably more than trebled considering AMRN is a mid-cap) I doubt anyone would be complaining?
From a very satisfied BA shareholder (despite the recent troubles).
I said it several times but again:
- I do not have a price target
- I do not have a valuation (lack of enough info / data / etc … as anybody on this board) … nobody knows Amarin's view and what the potential buyers think
… but I won't be surprised if the final offer will be 3 digits … as a result of the bidding war
I've been an investor since JZ, and bought in before Adcom (although a much smaller holding than what I had before RI readout).
But so far as credentials, feel free to hold me to my sales prediction and I'm sure you'll rub my face in it if I'm wrong.
What's your prediction since you're all about credentials.
Hey I'll give him full (100%) credit on the science.
He was absolutely right, and all the experts were wrong. He was right about inflammation. That is his area of expertise, the science.
All I'm saying is moving forwards, this stock becomes less and less about the science and more and more about the execution and actual sales(buyout notwithstanding). If he wants to keep yelling at us suits and telling us how little we know, then how about a nice put up or shut up prediction.
You talk a big game but with very little expertise (on the pharma sales side) to back it up.
Why don't you come out and predict total 2019 Vascepa sales since you know more than us "suits".
I'll put my reputation on the line. Looking at 2018 expected sales of $250+M, I predict total 2019 Vascepa sales at ~$1.2B worth of product, within a range of +/- 5%.
My guess is your prediction is upwards of $2B. Prepared to eat crow if you're wrong?
I have worked with BP and they certainly would pay closer to 3-5 times peak sales for a blockbuster drug that has at least 10 years on patent and the ability to have other indications and some defenses like (ability to lock down supply).
If there are no shorts, there is also less reason to spur rapid buying on good news, due to less need to cover.
Some will buy in on the AHA presentation, yes, but may investors also will sit on the sidelines until we're less about potential and more about execution.
Working in industry, you see both sides of the coin.
Both the single-payer system and the US Privatized system have very different pros and cons - ultimately there is no perfect system and either system requires huge compromises.
The US system is extremely expensive - nobody can deny that. Even many doctors think the price of healthcare is ridiculous (although they're not going to give up their fat paychecks).
For that (absolutely massive) sum of money, what we get in return is the bleeding edge of health sciences and the best and most stringent (also the most frustrating as we saw with AMRN) drug regulatory standards on the planet. There is a reason why the Thalidomide scandal didn't happen in the US.
Trump is right in that US drug prices are extremely high because we subsidize the rest of the world, but the US also gets the best healthcare first. Experimental therapies? Most of them are in the US. The best surgeons and drugs? US first. Research into exotics like cannabinoids? Legalized first in single-payer Canada but you bet that the bulk of key research is done in the US, not liberal paradise Canada.
You're even more out of luck if you're into more elective procedures less life-threatening, more quality-of-life stuff like orthos, cosmetic, ophthalmology, etc. The most skilled surgeons are in the US. You don't see much high-end research into stuff like ACL rejuvenation or LASIK in places like the UK or Canada. The best English soccer athletes come to the US to fix their injuries ASAP, not queue in the NHS (where they'll be asked to take 2 aspirins and call them in 6 months if it still hurts).
However, the ugly flipside to that is that the US system is also hugely inefficient and there is a lot of waste in healthcare as a ton of money goes not just to healthcare professionals and investors but in the administrators and support services like malpractice etc that would largely not exist in single-payer.
In addition because the US healthcare providers do not have scale like in Canada (some of the largest companies in the US have only hundreds of hospitals at most vs almost 2000 in Canada), they lack negotiating power and the economies of scale.
There is also a lot of replication, creating waste in the system. If there are 2 hospitals in your town, both run by different companies, each requires their own administrative setup, supply chain & logistics etc while in single payer the government only needs to set one up. There definitely is a lot of scope for reducing inefficiencies in the US model.
$25-26 pre-AHA.
The circumstances are not the same.
https://fintel.io/ss/us/amrn
Sept 2018, > 18% of the float was sold short.
Today, it's near or under 10%. That's a reduction by half.
Options activity also show far more bullish calls than puts.
The market is optimistic about this stock, unlike in Sept 2018. There just aren't as many buyers - in effect the mood is "Prove It" not "Betting on Zero".
There could be a small pop but there won't be massive short covering like there was in Sept on results announcement.
hamky, wouldn't you say it's likely tied to hard MACE and in particular CVD death come November 12th? I expect CVD death RRR over 30%. I don't think the market expects that.
https://www.foxbusiness.com/markets/what-is-a-contingent-value-right
Finally, contingent value rights rely on the good faith of the acquiring company to pursue a course of action that could actually allow the CVR to become profitable.
While CVR contracts specify that an acquirer must use good faith in conducting its business, the potential payout creates a conflict of interest, especially if the company has to invest even more cash to develop a speculative product it doesn't see as worthwhile and perhaps only agreed to in order to consummate a deal.
So what’s your post AhA price estimate same,a little up, or down? Non impressive results?
As a result, my M&A bet will be with AMGN (same as AF's prediction in an earlier STAT+ article) since AMGN can afford to pay the most. REGN is too small to pull off the merger despite a higher valuation than AMGN. It requires the company to execute a merger of equal with AMRN which is unlikely.
but lets say those chances in the markets eyes have gone from 98% fail to 50% something is wrong with the study
$50 + a healthy CVR in the near term..
I meant to ask a question yesterday about Novartis and the CRL they got - isn't that a material event that should have been reported within 4 days of receipt, not something buried in a 10-K weeks later?
I mean I am not saying a BO for $75 cannot happen in the near future, I am just saying it's unlikely that's all.
There are some seriously desperate BPs out there. Novartis and their CRL for canakinumab after the failure of most of it's cardio efforts certainly makes it more likely to fall into that "desperation" category.
But NVS is still a big name, with a large pipeline, unlike the AbbVie / PCYC situation, so it could stay on the sidelines for a while yet.