Amarin Corp Plc (AMRN)

[jessellivermore]

The sky is not falling.

With the thursday PM announcement of the !st Amendment suit against the FDA
Friday was supposed to be the time for our happy dance.

Instead the Grinch showed up in terms of a bum 1st quarter on the spread sheet. Summarizing it Amarin was net $32 mil behind (about 3 mil of which is non cash derivative nonsense). Currently Amarin has about $161 mil in cash.

So what happened? Well Amarin does have running expenses..the two biggies are SGA which was $24.5n mil and R%D which was $12.5 mil. Add in another $3 mil non cash. And this $40 mil. These were higher than average because they included legal fees. On the plus side revenues were down because of the horrible weather in the north which affect all chronic medication scripts, Vascepa less than most of the others. Also the customers who buy bulk from Amarin and represent a major revenue stream lowered their inventories during Q1 (in response to bad weather) and this showed up on Amarin's balance sheet.

So is all this a problem? Well to begin with, Amarin is not a retailer, so earnings are a secondary consideration at this point in development. Some of the Q1 loss will show up as gains in the next few quarters. Yes Amarin could take steps to lower its SGA (particularly the "A"), but there is little long term financial threat as the script numbers continue to climb (41% over the past year).

There is much to be optimistic about. The 1st amendment trial should play out over the next 6-9 months. This is what Amarin's lawyer says. In the recent drug rep 1st amendment appeal; the appeals court ruled the FDA can not prohibit the dissemination of truthful and non deceptive medical information. FDA chose not to further contest this matter. It is highly unlikely the judge is going to decide against a recent ruling by the the appeals court. The important thing here is due to the resent appeals case, all Amarin needs to prove is it intends to use truthful and non deceptive information.

The thing to keep in mind in the unlikely case the FDA decides to fight the initial decision by the judge, which is almost certain to be a declaration for Amarin; The company would still get relief to explain the benefits of V, and would continue so until a higher court decides against them.

":>) JL