Here is my cautiously optimistic take as we head into the new year:
There are many reasons AMRN's sales have been lackluster, and we wish the medical community would be a little more progressive in accepting Vascepa as a great preventative drug. If that changes, it may not change on the same slow climb we’ve been experiencing.
But the lynchpin of AMRN’s current woes is clearly the FDA, and most importantly, the rescission of the SPA.
The SPA mechanism currently allows a federal agency the ability to inflict serious harm on a private company for no compelling governmental reason. (In my opinion, there are strong parallels here to Fifth and Fourteenth Amendment protections against government “taking” without legitimate government interests and without fair compensation.) This needs to change.
It is currently understood that the SPA rescission is based on the agency’s interpretation of congressional statute, regarding efficacy of the product in terms of the outcomes for a particular population. (HD repeatedly makes very good points here.)
However, there are several potential weaknesses with this regulatory approach:
1) FDA may not be interpreting [url][/url][tag]insert-text-here[/tag]the SPA language entirely in good faith and/or entirely correctly.
2) FDA may not have provided due process[url][/url][tag]insert-text-here[/tag] in the activities that led to rescinding the SPA. (Notification to AMRN, ADCOM management, conflict of interest issues, timing of regulatory actions, and even a legitimate appeals process, appeals timing, etc.)
3) FDA may not have a compelling government interest[url][/url][tag]insert-text-here[/tag] in rescinding the SPA, regardless of the SPA language. That is to say, the “efficacy” language of the SPA protocols may be constitutionally and/or legislatively unsupportable.
If any of the above arguments are found worthy, then,
4) FDA has not provided any compensation to the corporation for rescinding the agreement. (Music to BioBill’s ears, I’m sure!)
The Senate committee appears to be attempting to shed some light on this issue. Hopefully, the outcome won't be a complete rubber stamping of the FDA’s activities. (You can bet lobbyists have been trying to call upon these elected officials to discuss their clients concerns, and it may be a broad-based concern.)
In its response to the Senate committee, the FDA may well find it extremely difficult to explain its recent SPA actions in a manner consistent with either the original intent of the statute, vis a vis other SPA decisions, or in a manner that satisfies the current Senate. However they respond to the Senate committee, there must be greatly concerned with exposing the Agency to potential claims.
As for the appeals process, as we all know, AMRN announced four months ago that they wish to forego the last step of the appeals process. However, if it came to a court of law, I’m not sure the final appeal would qualify as due process, since the appeal would go to a party that has already weighed in on a previous appeal. So in a way, a court of law may perceive that AMRN has already exhausted their appeals, in terms of due process. (Wishful thinking, perhaps, but it’s conceivable. Requiring an appeal to a body that has similar individual participants stretches the credulity of “due process.”)
Most of the important moves in the near future are up to the FDA. I do have some modest hope that there will be some level of compromise on their part. Even the much reviled Adam F has said as much.
It is truly in the FDA’s best interests, and in the interests of the general public, to make some compromise with AMRN that will allow expanded marketing of a safe drug that has proven effective in reducing triglycerides and other markers that current scientific studies have shown to be associated with elevated risk of a cardiovascular event.
In the meantime, AMRN has set themselves upon the task of selling to their initial market, and although progress has been slow – for many reasons outside of their control – sales are continuing to improve, and competing sales are beginning to show weakness.
As for improving the balance sheet long-term, it may not depend entirely on whether AMRN must wait for REDUCE-IT interim results. It could also hinge on general sales, broader acceptance in the marketplace, and – yes – even official compromise on labeling for the product.
There is also the hope that the NCE suit will be positive. And, as long as research continues, there may be growing impetus for success in other areas, such as diabetes, fibro-myalgia, arthritis, dry eye syndrome, hepatitis, depression, etc…
Finally, it appears that management has wisely opted to concentrate their efforts on areas where they have the most potential for success: escalating sales, cutting costs, pressing for regulatory outcomes and protecting their many patents.
As you can see, I have plenty of hope for AMRN’s chances in 2015 and well into the future.
