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Seems like a study that might give doctors favoring fish oil supplements even more ammunition to support their bad choices since the study used a product, "crafted by CNC GELCAPS CORPORATION—an entity accredited with ISO 22000, HACCP, and GMP standards—(which) incorporates an orange flavoring agent to conceal the taste of EPA."
They don't believe it? Maybe Amarin can hire Judge Du to tour the globe, telling everybody how "obvious" it was that Vascepa could reduce heart attacks and strokes. She even got skeptical judges on the Federal Circuit and Supreme Court to believe her. What are a few European nations?
If they really don't believe Amarin, it shows how far the reputation of the FDA has fallen in the eyes of the rest of the world. The U.S. response to the first year of the pandemic will not easily be forgotten by the rest of the world.
I would think that the extension of the European patents to 2038 is the large enough window that Amarin needs for an eventual sale to a European pharmaceutical company. Now, it needs to secure Italy and France and get some price deals in places like Greece and Portugal under its belt. Then, it needs to show a trajectory of script growth in countries like England and Spain so a potential buyer can make projections about eventual sales. It would be nice if we could get something positive out of the BRAVE trial or the introduction of the Combo pill or something to make the company more appealing to a buyer. Then, it'll be important to unload the company next year sometime or in 2026 at the very latest so a buyer still has plenty of patent time to make money.
My only request of Holt, besides that he make the company flourish, is that he never again say the word "firstly" during the quarterly conference call. He must have said it 10 times yesterday.
When the proxy vote was happening, I was one of the few people on the board that was resistant to letting Sarissa take over the company. I believe I advocated for voting a couple members of Sarissa's crew onto the board, but otherwise favored leaving the team that was working in place so the company wouldn't have to start from scratch. I was obviously in the minority more than I knew! The vote was so solidly in Sarissa's favor that it led me to think that KM didn't have that much good will within the company. Even insiders must have been voting in favor of a takeover. I think KM's trouble was a bit of arrogance and an inability to communicate well. Somebody like that can still flourish in an established company like Merck, where he built his good reputation, but they're probably not the best for a place like Amarin.
Once Denner was voted in, I got fully behind him and I remain so. I don't see the point of griping about the past. KM was right that the stock and company won't truly turn around until sales pick up around the world. We'll probably start to see that in a meaningful way next year. So unless there's a big surprise announcement of something none of us know anything about, we'll be lucky to hit $3 a share in the next year to 18 months. But I think our days of the share price under a dollar will be in the rearview mirror for good in a few weeks.
I had always thought a buyout would be for at least $18, roughly the price of the offering in 2019 that gave the company all its cash three days before the FDA ordered a hearing and delayed Vascepa's approval for its heart indication by several months. But now I'd take $12 in a heartbeat (pun intended).
The relatively low share trading volume yesterday made it clear that the fall in share price was a buying opportunity, nothing else.
Sarissa has one goal and they've not been shy about making it clear: To sell the company and make as much money as possible on their investment. How is that not in the interest of shareholders?
I've used that argument a few times myself when I'm in the mood and feeling angry about my investment. But let's face it, there are tens of millions of potential patients in America and we have about 60,000 scripts each week. So if we're finally, after two years, just getting started in Europe and we've got 5,000 patients and they are growing by double digits by the quarter so much so that they've nearly doubled since last quarter in some locations, yeah, I see a little reason for hope. As for when Vazkepa was first available for sale somewhere and when it was approved for reimbursement by a government and Amarin begins marketing it to doctors and realistically can ramp up sales seems to be two different things. It looks like we've really only gotten going in the last two quarters.
I don't think it's too surprising because, as I recall, the fourth quarter benefitted from the usual robust end-of-year sales along with extra money from Edding because of the China approval. During the 4th Quarter conference call, they said licensing and royalty revenue was $4.2 million, "resulting primarily from the achievement of the Edding CVRR milestones." Now, it sounds like scripts in Europe is about 5,000, a nice growth from the last quarter. So income from those other countries should start accumulating soon. And, if I remember correctly from other years, it seems that the biggest slide in U.S. revenues occurs in the First Quarter every year. I think we'll start seeing a nice improvement in the next two quarters and, by the fourth quarter, we'll start to be able to see that rest-of-world income is becoming meaningful in comparison to U.S. income. Eventually, it won't matter how much the U.S. market shrinks.
I've never been less bothered by a 10 percent drop by Amarin. For one thing, I think the last two earnings calls and statements were purposefully dull, if not discouraging, by design in the runup to the stock repurchase. And it serves all of us well if Amarin does its buyback with the share price as low as possible. That's also good for the company as it shops itself to potential buyers. Of course, my mood is aided by watching CTMX go up dramatically today.
I agree that there will be catalysts in the second half of the year, and the company stated in the fall that it expects to finally get "meaningful" sales in Europe beginning in this year's fourth quarter.
I also note that the drop in price today is happening on relatively low trading volume considering that the company just announced its earnings. So I'd say the share price drop today and the accompanying doom and glooming is much about nothing.
Yeah, that was definitely one of the most birdbrainery things I've written now that I reflect on it. Haste makes waste!
Everything you say rings true. I always thought the action against Health Net was merely to force the insurance company into a settlement so that it would conform, at a minimum, to the practices of the other insurance companies. I don't believe Amarin ever intended to seek damages and certainly didn't want to set some sort of precedent that would affect, and offend, all insurance companies, many of whom Amarin was trying to negotiate with at the time. If I recall right, Health Net's violations were pretty blatant. So Amarin likely got what it sought, a level playing field with generics from that company.
As for the generic bias, you make valid and accurate points. I guess the Amarin case differs from so many other companies, as you know, because its price isn't all that much different from generics and it never got a chance to make money with Vascepa before generics entered the picture, thanks to the FDA requiring the Reduce It trial before it could get going and Judge Du's ruling.
I know nothing about how much buying of a stock it takes to move the price, but I would imagine you'd have to really space out your purchases if you're planning to drop $50 million into a stock. Wouldn't the sudden purchase of so many shares make the share price explode to $6 or higher? I would think you'd have too limit your buys to 200,000 to 300,000 shares a day, tops, to keep the share price down while you carry out purchases. But I've also seen companies announce share buyback plans and never come close to buying as many shares as they pre-announced.
To this day, I've wondered why the Federal Circuit was so dismissive of the appeal of Judge Du's ruling. It crossed my mind that there was something unusual going on. Perhaps one of the judges knew Judge Du personally -- not a far fetched possibility in the small circle of federal judges nationwide -- and thought the Amarin lawyers were insulting and belittling to Judge Du in the way they wrote their appeal papers. As I recall, Amarin's lawyers toyed with the concept of "obviousness" in a way that a friend of Judge Du might have thought was condescending toward the judge and her reasoning. Judges tend to get somewhat defensive when they feel like a fellow judge is being mocked or unjustly cast in a bad light for doing her job, or at least trying to do her job.
Generally, a pithy one-page dismissal of an appeal of this kind of importance is rare. In the case of the Amarin arguments earlier this month, the panel will have to carefully word its opinion so that the lower court judge has clear instructions on how to proceed and why the case is being returned to him. And since it's such a sensitive subject of law (skinny labels) to small pharmaceuticals and the vulture generics who want to steal their products, the judges will likely be careful to make clear that they're not trying to set any precedents with their handling of the Amarin case, especially since the lawyer for generics made it sound like the judges would be rewriting law and eliminating skinny labels all together if they revive the case. One judge did a great job on the spot of shooting down the balloon that the lawyer for generics floated to that effect, but they'll want to make it doubly clear in their written opinion that the judges all agree with what was said off the cuff. So careful and thoughtful wording will go into this decision, regardless of its length, which probably adds weeks to a ruling coming out. Still, I hope I'm wrong and we see a ruling tomorrow because I think Amarin's share price will get a nice bump even though any of us who heard the arguments already know the outcome.
That's a great point. This should have been dismissed at an early stage. The fact it ever made it to trial should have been a trumpet blaring in the ears of Amarin lawyers that they weren't getting their message across to the judge.
I'm glad we did Brave though because it would take very little in the way of something positive about EPA from the trial for the share price to get a jolt. It's probably one area of medicine where there is desperation for a single drip of something that might work.
Thanks for the correction. At least the drop today was on low volume. Perhaps the share buyback was approved by shareholders and somebody's not happy about it?
Ok. I see why shares are in the toilet today. That garbage of an outfit -- Seeking Alpha -- poohed all over Amarin, claiming the share price should be 66 cents and that there's no hope for meaningful sales, pretty much ever. At the end, where somebody might normally list risks, the supposed "analyst" lists risks as things that could happen such as increasing sales that would cause the share price to go up and spoil his pessimistic viewpoint on the company.
I think the best catalyst would be to show a trend of increasing sales in places like the United Kingdom. I think they said during the third quarter earnings call last year that "meaningful" sales should begin to show up at the end of this year. I hope that is true. I guess any hope of a positive spin being put on the Alzheimer's trial, even if it didn't meet its endpoints, are fading fast since they originally said some results would possibly emerge in March.
I think the share buyback was instituted for multiple reasons and the decision was made carefully with knowledge of things the rest of us can't know. Since that money was originally destined for U.S. promotions, it makes sense to put it to use, even if it's just to buy back shares. For one, Denner likely knows the true value of Amarin shares. So if he sees that a buyback can occur at a quarter or an eighth of the company's true value, he's thinking it's a smart investment that makes the company more appealing to a potential buyer. It was probably also made because Amarin is close enough to "meaningful" sales in Europe and elsewhere that it is confident in profitable quarters ahead, it will also likely be used to keep the share price above a dollar and it sends a message to Wall Street that the company believes in itself. And the company presumably knows about some positive developments in the second half of the year that will raise the share price.
If the company really can't make it on the $270 million that remains after the buyback, then we're all in pretty big trouble.
I remember your 2022 post and how you seemed rather rudely treated until you got into the room. Thanks for going to the meeting again and I hope this time that they welcome you and give you food and gifts, because you really do represent us all. If you can get any sense of when the company can begin buying back shares, please let us all know. I would be surprised if the share price does not begin a steady rise once the buyback starts. And by steady rise, I mean a couple cents a day, which probably all of us would embrace after what has seemed like a long dark winter.
Your measured response to my rude adjective was just another example of your higher intelligence. I see what you say about the fallacy of calling Vascepa fish oil in any form. And Amarin goes out of its way, I think, to generally avoid bringing fish into the equation.
But I think the point I was making was that you can do a lot of funny things with advertising and promotions in general with fish whereas I can't think of anything you can do to promote a drug whose name nobody can pronounce whether we call it Icosapent ethyl or Vascepa. You'd think just saying that it can reduce the chance of heart attacks or strokes by over 25 percent would leave an impression on most doctors, but apparently not.
I guess my question is whether fish is indeed a necessary ingredient in the creation of Vascepa. Dr. Bhatt seemed to be saying that Vascepa cannot be made without EPA from fish because algae and other plant-based ingredients rather than fish haven't worked yet. If so, then I think Amarin would be fully within its rights to use fish to promote itself. And this would seem to be an easy sell because just about everybody seems to agree that fish are good for us and that people who live in areas where they mainly just eat fish and vegetables live longer and healthier than we do. And since the massive fish oil supplement industry has convinced so many people that supplements are great for all kinds of reasons, Amarin could steal a move from the supplements playbook and take over their market by convincing people and their doctors that Amarin is the 100-pound gorilla and Vascepa is the only product they should consider using.
It looks like ChatGPT was hallucinating a little bit when it answered your second question. Yes, the trial-level judge who originally dismissed the case against Hikma can dismiss the lawsuit again, but only after both sides have the chance to gather and exchange evidence, including emails and correspondence that Amarin will hope contains a smoking gun or two that will further illustrate Hikma's bad intentions. At a later point prior to trial, Hikma will again move for dismissal of the lawsuit on the grounds that the judge can find as a matter of law that Amarin cannot satisfy the legal points necessary to take the case to a jury. And, at that stage, the rules of the game will not be as favorable to Amarin as they were at the current stage, when the trial judge was supposed to accept that everything in the lawsuit was true.
ChatGPT makes it sound like the judge can respond to the appeals reversal of his dismissal by merely writing the equivalent of a legal essay back to the appeals court to better explain why he threw out the case in a way that he thinks the appeals judges might accept.
With a reversal, three judges on the Federal Circuit (assuming its a unanimous ruling, which it certainly seemed it will be based on the tone of the arguments) will be telling the trial judge that he was wrong. The judge cannot then merely "choose to reaffirm its dismissal of the case" if he "believes that its original decision was correct." That's where ChatGPT was hallucinating.
Judges don't argue with each other that way. It's very much like the military. The lower court judge will be told politely by a superior (the Federal Circuit) that he is wrong. If he tried to protest and insist he was right, the higher court would take the gloves off and scold him like a small child. And he'd lose the respect of his fellow judges. I've been watching courts closely for nearly 50 years. This would never happen!
You seem smart (though a bit pompous) so I'll quote Dr. Bhatt from his 2019 Grand Rounds presentation. Assuming that what Dr. Bhatt said is true -- and I do -- there is plenty of room for Amarin to choose a creative way of communicating about its fishy product that may aid in the education of doctors and their patients.
During the question and answer period, he was asked to define Icosapentic Acid. He said: "It’s derived from nature, from marine sources, i.e. from fish. So it ultimately is coming from the fish. It is purified and distilled and then an Ethyl ester is created of Icosapentic Acid. There are companies working on fully synthetic or vegan versions of EPA as well. None of those are anywhere near clinical trial testing though."
At the 41:51 mark of the presentation, which he made in condensed form to the FDA a couple weeks later, he showed a chart that included Icosapent Ethyl. Underneath those words rests a photograph of what looks to be nine or 10 small fish stacked on top of one another. Beneath this photo are the words: “Marine Fish.”
Then he says: "Even though epidemiological studies do suggest that higher fish intake is associated with lower risks of cardiovascular disease, not so much stroke, but coronary disease type events, I think that purifying it into a prescription medicine, Icosapent Ethyl, really provides cardiovascular benefits and health benefits."
He also notes that Vascepa was first studied in the "Marine Trial."
Later in a question and answer period, Dr. Bhatt said it would take 22 servings of fish a week to equal Vascepa. “It would be a lot of fish you’d have to eat so you’d have to love eating fish to achieve that."
The fish oil supplement industry has bombarded the world's population with huge amounts of advertising for decades and convinced 90 percent of people, including doctors, that fish oil is a great solution to combat nearly every human ailment, from depression to heart disease. So your solution is to make it clear that Vascepa is NOT fish oil? Totally disagree. Amarin has been doing just what you advise for the past five years with horrible results. What the company needs to do is accept that everyone thinks it's fish oil and convince everyone that it is, in fact, the KING of fish oils. As JT once put it: "It works!" Amarin could build a campaign around that, like the milk industry did with "Got milk?" It should be doing funny ads using fish, ala Charlie the Tuna from the 1970s. Have a fish as a mascot.
Or, as it is prone to do, Amarin can commission 50 more analyses of the Reduce It results and distribute the findings at 200 more medical conventions. And watch sales remain stuck in the mud, much like the creativity of the company.
I'm pretty sure it was during an earnings call and he said it would be a combo pill but that they take three years to perfect because it has to be the right mix. So three years is up at the end of this year.
Thanks for clarifying on the subject of generics. I know nothing about that world, obviously. As for the new formulation, I remember KM announcing that they'd begun working on it over two years ago. He said it would take three years to create. Initially, he and other company officials made it sound like a way to take back the U.S. market. But then, a year or so later, they started speaking of it differently, saying it would be offered in all the markets, except the U.S. So maybe they learned that generics would be allowed to immediately copy it in the U.S. and perhaps feared that people elsewhere in the world would try to order it from generics in the U.S.
In my dream scenario since the three years it takes to create the new formulation is reached at the end of this year, the company announced this $50 million buyback so they could secure as many shares as possible before announcing the new product later this year. Maybe the buyback is a way to make the company more attractive to a buyer just before the new product announcement also enhances the possibility of a sale.
It would seem in Amarin's and our interest to get a sale done in the next year, if possible, while there is plenty of time left on patents, including the U.S. patents covering the heart indication.
You make a lot of great points. I do, though, wonder if this is one area where the company has motives it can't state publicly for leaving the U.S. market where it is. For instance, it might be trying to starve out the generics, making it so not worth their while that they'll abandon the market all together. Part of that strategy would include the lawsuit against Hikma, which now seems certain to be restored.
I also think they gave up hopes of advertising in the U.S. because they knew it would take a long time to get Europe going and they would have put themselves in a precarious situation financially if they blew tens of millions of dollars trying to grow a U.S. market that was rapidly shrinking, if not in demand, at least in price.
It also didn't make sense to them to pour money into a U.S. market where they'd get only 57 percent of the resulting sales when the money would be better spent in emerging markets where they are entitled to 100 percent of the sales.
And, finally, lets face it: Amarin was terrible at promoting itself when it tried for a year or so. I have always believed that Amarin blew it by letting doctors have too much influence on their advertising. They decided they would run away from the idea that fish have anything to do with Vascepa. They banned any mention of it when they should have been promoting fish as the secret ingredient to the magic of their product. Everybody knows eating fish is great for anybody's diet. And decades of promotion by fish supplement companies has convinced the public (and unfortunately doctors) that all kinds of fish oil is great for the body too. So while Amarin was trying to avoid any mention of fish, it should have been doing the opposite, creating funny advertising promoting itself as the king of the fish and fish oil products. It's counterintuitive, but it would work. When dealing with stupid people (which a lot of doctors have proven themselves to be, at least in regards to Vascepa) it's best to go full stupid.
I think going after the unscrupulous and wealthy insurance companies would cause all kinds of problems for Amarin and the company knows this. Even though insurance companies surely don't play fair, they are pivotal for sales and I imagine Amarin works hard to try to have a good relationship with most of them, if only to get good placement on formularies. Health Net was a relatively small fish in a sea with lots of whales. So Amarin could send a message without (hopefully) poisoning its relationships with big players in the insurance industry.
Re: Buybacks. Does anybody know the rules? Would Amarin have to pre-arrange to buy a certain number of shares on a certain day or can some Amarin employee sit there each day at 3:58 p.m. and buy up as many shares as necessary on days when the share price is down to take it back to even?
It seems that the slumpy days like today almost always occur when there is very low share trading volume. So adding a few hundred thousand shares purchased by Amarin on some days will definitely raise the share price. And my expectations have fallen so low that I get as excited now when AMRN goes up 3 cents as I used to get when it went up 3 dollars.
What a powerful post. And it doesn't carry just the ring of truth. It is truth.
Your description of the appeals judges, in particular, hits a bullseye. I recall being stunned that they didn't analyze the case at all, just dismissing it in a pithy one-page order the next day like it was some frivolous thing to destroy a company, kill the U.S. market for a lifesaving heart medication and put nearly 1,000 American workers out of their jobs. Like there was no need to take a harder look at the case.
A lot of trial-level judges make dumb decisions. But typically, they get reversed by appeals judges doing their jobs. Didn't happen here.
This was a hilarious post. And so true!
Although I picked up another 2,000 shares today, I don't mind the share price staying around a dollar right now. It is in all of our interests for Amarin to be able to buy back as many shares as possible with its $50 million. And the time when the company can start its buyback is probably just weeks away.
I also think that if any earnings this year are going to be terrible, it'll be this quarter. The clock was reset as the year started when it comes to Amarin's exclusive deals with some entities that has protected its share of the market. And it's also possible that it had to drop its price a lot at the start of the year, as happened a year ago. Then I still worry that there will be those surprising $10 million charges to fix inventory. I also think that the company will find it in its interests to stack the bad stuff in the first quarter so that the share price can take one last hit right before the company jumps in and starts buying back shares.
So I'm lowering my expectations for first quarter earnings and saving a little share buying firepower in the event we get the earnings disappointment that is always possible in quarter one.
You are right that I went a little overboard in absolving Judge Du. In my study of courts over the years, I've noticed that judges usually go out of their way not to destroy a company as she came close to doing. Or should I say Duing. My guess is that she didn't understand the ramifications of giving out a "skinny" label to vulture-like generic companies and that it would destroy marketing capabilities and abruptly halt the expansion of use of Vascepa in America, leading to the deaths of some people who otherwise might be saved by the drug. And she had plenty of exit ramps to choose another course. It seemed preposterous to suggest that Vascepa could have been invented by anybody with reasonable medical knowledge. If so, somebody certainly would have done so in the decade or so before Amarin did. And then the medical field's surprise at Vascepa trial results and the robust growth of the drug after sales began should have protected the patents as well.
I'm not a lawyer, though, and I've learned not to try to share my amateur views with attorneys. Marjac was very kind in comments he made yesterday about my posts regarding the Federal Circuit arguments, but his knowledge and experience with the law is so vast in comparison to what I know that I would never bother him with my spectator-like observations, beyond what he sees on this board. It would be like some out-of-shape guy in a bar telling a professional baseball player what he thinks he should do on the field.
That's not true about most judges having a personal agenda. At least at the federal level, where Amarin swims, the judges I've known in my life are mostly quite intelligent and dedicated to the law. I don't blame Judge Du's ruling on her. I blame Amarin's lawyers. They were terrible. Didn't articulate the real issues for the judge at all. They took her deep into the weeds with no clear message. Called lousy witnesses at the trial. Wrote summaries after the trial that were hard to understand.
I vote for what you just wrote as the smartest post of the day. It really is all about a BO. The extension of the patent in Europe is really important because we're already three years into our 10-year European patent protection window and we have nothing to show for it in the way of sales. So how much would a Big Pharma be willing to pay for nothing?
It seems that we heard all kinds of enthusiastic language in earnings calls and at investor conferences over the last four words about "ramping up" and "hiring teams" in various countries to prepare for "launches." But sales once those launches occur seem stuck in mud. Maybe we get a few hundred people using our drug out of tens of millions of potential patients. It's clear that for whatever reason -- and likely often out of ignorance -- most doctors are unwilling to prescribe Vascepa.
I've always thought that Amarin is a little doomed until it figures out how to get mass media exposure. It has a major distinction from other drug makers in that its primary competition is a supplement that has been widely promoted for decades as a miracle "fish oil supplement" that will help the heart and replace fish dinners as a great resource to extend a life. It's astounding how many patients take fish oil supplements regularly. I think Dr. Bhatt once said that at least a third of his patients have admitted to it and he suspects the number is much higher when you include those who do not.
And it's scary how many doctors, including cardiologists, tell us just to take fish oil supplements rather than Vascepa. Amarin can release another 100 studies of Reduce It results over the next five years and it's really not going to move the needle. It needs to somehow figure out how to counter the mass media campaign by the fish oil supplement industry that has convinced doctors and patients alike that they don't really need Vascepa because there is a cheaper alternative.
I certainly am usually wrong, but I wouldn't be surprised if it rallied again tomorrow. I think that's because a lot of investors haven't heard the news, haven't listened to the oral arguments and analysts haven't had a chance to weigh in either. So there's always the possibility that some brokerage outfit sends out a note tomorrow to its investors, giving the stock a boost. Or word of what happened spreads more thoroughly and more people decide it's a good time to pick up more shares. Plus, we're now in the second quarter and I believe Amarin said it expected to get the ability to start buying shares back with the $50 million it has set aside for that purpose sometime in the second quarter. I would think most people would want to be in the stock before the company starts its buyback.
Even Hikma acknowledged at the 2020 trial that 75 percent of the market, at least, is for the heart label protected by patents.
One thing I found particularly encouraging in the judges' comments today was an understanding of exactly what Hikma was doing: trying to get a big share of the 75 percent of the Vascepa market that is protected by patents. Once judges get a whiff of a big injustice, I've noticed that they are much more apt to view the law in a way that favors the aggrieved party. Even the lower court judge seemed to get this. I don't know if any of you remember the oral arguments before him, but at one point he complained that it seemed like the system was set up to violate Amarin's patents and that somebody must be to blame. It's just that he chose to blame the insurance company and to let Hikma off the hook.
And yes, the lower court judge can dismiss the case again. But the appeals panel, which would be the same judges as today, could restore it again. I've seen that happen.