Fact reconciliation Saturday is here, and these are the facts:
- All indications to date are that Thero is a super competent and savvy CEO
- This is a company that is a very "proactive communicator", if anything, over-PRing things like conferences, and sometimes relatively trivial milestones in trial progress (e.g. PRing 90% of events occurring)
- Thero never, as far as I can remember, ever said anything about BO possibilities until the early December conference, when he said something like, "But we work for the shareholders, and if we are approached, we would give it serious consideration." Not those exact words, but something like that.
- PRwise, they went absolutely radio silent from the end of November until announcing the JPM conference appearance on Jan 2. Last year they PRed the JPM conference appearance on December 18th.
- The 2019 guidance was careful to the point of being inexplicable. As most noted, $350mm for 2019 reflects the most modest possible growth from Q4 2018 levels, even assuming getting stuffed by the FDA timewise on a decision. And they released it after the close on a Friday afternoon. Which is like blowing your nose on someone else's sweater.
- The guidance also went completely silent on Euro partnering, a topic Thero had been perfectly happy to talk about in conferences and calls prior to JPM. Suddenly the topic vanished from the radar. The Q&A's aren't transcripted as far as I know, but the main presentation was absolutely silent on this topic.
- After pre-market trading in the $12.60 area last Monday morning, the stock took off like a shot for the first two hours -- straight up on big volume. The IBB did go up as well, but only by a fraction of that move. Prior to that move, AMRN had been trailing every rally and exaggerating every downtrend for weeks.
- On mere rumors of Pfizer interest in AMRN, the stock went up over 20% on massive volume on Thursday, closing at $18.35.
- On Friday, after a 22% gain in a stock where most buyers post-9/24 were in the red, including secondary participants at $18 per share, the stock pulled back only modestly to $18 at the close.
Think of this exercise as a "least squares regression" exercise -- like a banker would view it. What is the explanation that fits backward through these facts hugging the closest to the trail on the whole? Or if you prefer, think of Occam's Razor -- all things being equal, the simplest explanation is most likely the correct one.
Did Thero's management approach and narrative just suddenly change for no reason (e.g. maybe all that Vascepa he's been taking finally kicked in and levelled him out), or is there an external driver for his change in MO? Did a stock getting pounded on sour sentiment and unclear outlook suddenly get rosy again, just because JPM held a conference? It certainly wasn't that Friday afternoon guidance that got everyone giddy...